Newly Disabled and Need Good Advice

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SteelersFan56
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Newly Disabled and Need Good Advice

Post by SteelersFan56 » Fri May 12, 2017 8:17 pm

Hello Everyone,

I have a major problem with very few good options.

I am a 60 year old Man who has suffered a disability which enables me unable to work. I have filed for Social Security Disability and thought that having 3 separate Doctors writing reports certifying my condition would certainly assure me getting approved. Well the Government had other ideas and I have been turned down twice and I am awaiting a hearing in front of a Social Security Disability Judge. This hearing will take approx. 16 months from now to come to fruition.

Meanwhile we are really struggling without my income. We have exhausted our emergency funds and have been forced into tapping into our retirement funds. We need approx. $3,000 per month to cover all of our expenses including food, shelter, cars and taxes.

Our financial Picture:

Income:

My wife has a full time job which after taxes and health benefits brings home $800 a month. Presently were are running a $2,200 monthly deficit and that is not sustainable much longer.

Savings:

We have approx. 350K between my Rollover IRA and my wife's Rollover IRA and 401K plan. This is entirely in Money Markets as I am in preservation mode as I try to come up with a game plan. Under the best of circumstances we are risk adverse investors and with our present situation we are unable to stomach much volatility.

I have a Lawyer working on the Social Security case but it is going to me a minimum of 16 months until we have any hope of winning our appeal. Health wise, I am unable to work at all so even a part time job is out of the question. After a lifetime of work and raising our family this is not how we anticipated approaching retirement but we have to deal with the cards we are dealt.

My question is what would you do, investment wise, if you were in our shoes? While garnering the needed $2,200 a month is not impossible with a 350K portfolio it would certainly entail a lot bigger allocation of stocks than we could stomach. Even under normal circumstances I never invested over 25% in Equities because I couldn't sleep at night when I did.

We have no interest in an Annuity so no use even considering that option. We have several reasons we feel that way and there is no use me wasting your valuable time discussing something we will never do.

We live a very modest lifestyle and have downsized our home to a point where that is not an option. Cutting expenses, while always desirable, is probably not feasible.

I would be interested in any and all other suggestions you may have to design a plan to invest the resources we have left and try to survive until I turn 62 and collected early Social Security. That will garner about $1,200 a month which will at least cut the monthly deficit to about $1,000 a month.

Thank you for your kind consideration,

Steelersfan

stan1
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Re: Newly Disabled and Need Good Advice

Post by stan1 » Fri May 12, 2017 8:29 pm

Do you own your home? If so how much is left on the mortgage, how many years left on the loan, and what is your monthly payment? It might make sense to pay off the mortgage with your savings if that would help you get your monthly expenses down closer to your wife's salary + what you expect from SS in 2 years.

SteelersFan56
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Re: Newly Disabled and Need Good Advice

Post by SteelersFan56 » Fri May 12, 2017 9:29 pm

The home mortgage was recently paid off.

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grabiner
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Re: Newly Disabled and Need Good Advice

Post by grabiner » Fri May 12, 2017 9:39 pm

Welcome to the forum!

While you cannot get a sustainable $2200 per month ($25,000 per year) out of a $350K retirement portfolio, you won't need to get it for very long. If you are denied SS disability benefits, you will soon be eligible for regular SS benefits. If your disability also shortens your life expectancy, you can start taking SS at age 62 for a reduced benefit. If it does not shorten your life expectancy, you can wait until age 70 to take SS; you will use up most of the retirement accounts in ten years, but your SS benefit at age 70 might be enough to cover the $25,000 all by itself.

You will also be eligible for Medicare, either upon determination of your disability, or at 65 under the regular rules; this will reduce your income shortfall.

The $350K retirement account should not all be in money-market funds. Money-market funds are appropriate for short-term needs, but you have short-term needs of only about 8% of the account, as you and your wife will be drawing on it for years. One year's withdrawals might be in money-market funds, but if you put the rest in a bond fund (something like Vanguard Total Bond Market), it is more likely to keep up with inflation. The portion which you won't need for ten years (about $100K under the example above) could go back into stock.
Wiki David Grabiner

rebellovw
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Re: Newly Disabled and Need Good Advice

Post by rebellovw » Fri May 12, 2017 9:46 pm

Since your mortgage is paid off - where is the 2200.00 going? Can you reduce it further? Perhaps your wife could reduce her 401K contributions until this passes? I assume some of her income is going into the 401k - perhaps pause it?

Wish you the best.

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Pajamas
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Re: Newly Disabled and Need Good Advice

Post by Pajamas » Fri May 12, 2017 9:58 pm

Don't be despondent about being denied at the first stage. They deny the majority of initial claims but your chances actually improve at the third stage, for whatever reason.

http://www.ssdrc.com/5-72.html

maria00200
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Re: Newly Disabled and Need Good Advice

Post by maria00200 » Fri May 12, 2017 10:01 pm

I would also sit down and go through each and every bill you have, one by one, and see if you can shave as much as you possibly can from each bill. Tv/internet - downgrade to the lowest package or no tv and just use an antenna for locals and Netflix/internet. For phones either just a home phone or no home phone and a cheap bare bones cell phone plan. Car and home insurance, raise deductibles, take accident prevention course online for further discount. Cars, if they have loans on them, use savings to pay them off, or if monthly payment is too high, downsize to a smaller, cheaper car (possibly just one car to share).
Food/groceries, buy in bulk, no name brands, sales. Go through each bill you have and brainstorm any possible way it can be lowered, even if just by a few dollars.
After all that, see what you trimmed your monthly expenses down to, then I would follow the advice of the previous posts above. Good luck!

aristotelian
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Re: Newly Disabled and Need Good Advice

Post by aristotelian » Fri May 12, 2017 10:01 pm

I agree with above. Could you at least build yourself a CD ladder. Budget out your next three years of income and keep first year in money market, second year in 1 year CD, third year in 2 year CD. Put the rest in an intermediate bond fund. Should buy you a little extra time until SS kicks in.

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SeeMoe
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Re: Newly Disabled and Need Good Advice

Post by SeeMoe » Sat May 13, 2017 1:31 pm

It's a real shame that a legitimately injured worker has to hire a lawyer to mouthpiece his Claim thru the SS disability process! The lawyers will get a chunk of your eventual SSDI claim " for life,...!" The evident reason for the backlog is because so many deadbeats, especially younger ones now, who are looking for free money For life! If you can get out of the agreement with this lawyer, do it now! File your our disability claim and work with them(SS.) Maybe see a pro bono lawyer for some advice on filing appeals, or a lawyer for an hourly fee only! Otherwise tough it out for two years and then go on regular SS. Medicare at 65. Guard that $350,000.00 bucks and only dip into as a last resort until your situation stabilizes somewhat. Short term bonds and some intermediate bonds at the bond king, Vanguard, is the better option. Some Prime MM too. Good luck, and maintain the discipline!

SeeMoe.. :wink:
"By gnawing through a dike, even a Rat can destroy a nation ." {Edmund Burke}

Ron
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Re: Newly Disabled and Need Good Advice

Post by Ron » Sat May 13, 2017 2:17 pm

SeeMoe wrote:<snip> The lawyers will get a chunk of your eventual SSDI claim " for life,...!"
Generally, that is not correct. The lawyers (assuming a successful claim) can get up to $6K of back benefits paid to them for their services. There may be additional up front costs related to record gathering, but the main point is that any disability lawyer does not get continuous payments based upon the lifespan of the claimant.

OTOH, there are lawyers willing to do pro bono work, especially for a group of similar disabled folks without any fees. This was the case with my disabled son who had a lawyer that was associated with the local autism group. One letter from him to the decision board (after the first rejected claim) resulted in quick approval.

- Ron

S&L1940
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Re: Newly Disabled and Need Good Advice

Post by S&L1940 » Sat May 13, 2017 2:28 pm

Ron wrote:
SeeMoe wrote:<snip> The lawyers will get a chunk of your eventual SSDI claim " for life,...!"
Generally, that is not correct. The lawyers (assuming a successful claim) can get up to $6K of back benefits paid to them for their services. There may be additional up front costs related to record gathering, but the main point is that any disability lawyer does not get continuous payments based upon the lifespan of the claimant.

OTOH, there are lawyers willing to do pro bono work, especially for a group of similar disabled folks without any fees. This was the case with my disabled son who had a lawyer that was associated with the local autism group. One letter from him to the decision board (after the first rejected claim) resulted in quick approval.

- Ron
long ago, second hand info
husband disabled, turned down for SSDI, BUT SS offered a lawyer at no cost to appeal
luckily for them SS reversed decision before the lawyer was engaged
at the least I would question SS about process
Good Luck
Don't it always seem to go * That you don't know what you've got * Till it's gone

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friar1610
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Re: Newly Disabled and Need Good Advice

Post by friar1610 » Sat May 13, 2017 3:09 pm

This is a shot in the dark, but are you a veteran? Is there any case, no matter how slight, that the disability has any prior service connection?
Friar1610

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dm200
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Re: Newly Disabled and Need Good Advice

Post by dm200 » Sat May 13, 2017 3:45 pm

Assuming your disability is unlikely to significantly shorten your life expectancy, at age 60 - (even if SSDI is granted), I believe you would be required to switch to SS retirement - or only less than 5 years from now.

I am a little surprised it will take this long to appeal the decision.

Once (as best I understand) you are on SSDI for 2 years, you can qualify for Medicare.

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dm200
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Re: Newly Disabled and Need Good Advice

Post by dm200 » Sat May 13, 2017 3:58 pm

A few more thoughts/ideas:

1. Did you get any kind of disability income from your employer when you became disabled?

2. I would not file for SS retirement immediately at age 62 if the disability issue is still pending.

3. Some (perhaps many) local taxing jurisdictions have tax relief for real estate taxes for disabled and/or those over 65. I would fully investigate whether you may or will qualify for any relief or deferral of real estate taxes on your home.

4. Even though you have health insurance through your wife's employment, it is not too early to explore Medicare choices. Although not for everyone, as well as great differences between plans - often Medicare Advantage plans offer good "value" for premiums.

5. There may also be certain programs and benefits for those disabled in your jurisdictions as well. Even small benefits can add up and make a difference.

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SeeMoe
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Re: Newly Disabled and Need Good Advice

Post by SeeMoe » Sun May 14, 2017 3:36 pm

Ron wrote:
SeeMoe wrote:<snip> The lawyers will get a chunk of your eventual SSDI claim " for life,...!"
Generally, that is not correct. The lawyers (assuming a successful claim) can get up to $6K of back benefits paid to them for their services. There may be additional up front costs related to record gathering, but the main point is that any disability lawyer does not get continuous payments based upon the lifespan of the claimant.

OTOH, there are lawyers willing to do pro bono work, especially for a group of similar disabled folks without any fees. This was the case with my disabled son who had a lawyer that was associated with the local autism group. One letter from him to the decision board (after the first rejected claim) resulted in quick approval.

- Ron
Not so regards Workers Compensation claims in which the attorney representing the claimant will receive 20%, or more, of the claim for" the Life" of the claimant in most jurisdictions....If successfully argued. Why would it be any different for Social Security Disability claims? (As the lawyers are fond of saying :"60% of something,...Is better than 100% of nothing.")

SeeMoe.. :?:
"By gnawing through a dike, even a Rat can destroy a nation ." {Edmund Burke}

mouses
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Re: Newly Disabled and Need Good Advice

Post by mouses » Sun May 14, 2017 5:21 pm

I'm surprised about the Social Security disability situation. What I have heard from the rumor mill is that most people get turned down initially but approved the second time. Something sounds odd about it needing 16 months. I would look around for some other type of advocate as opposed to your expensive lawyer, perhaps someone associated with a group for people with your disability or a hospital social worker might have leads.

You say after taxes etc. DW clears $800 a month. Have you taken into account that your taxes will drop with your earning no income? If that is your only income and given that you may have large medical expenses, I would expect you would have no income taxes. I don't know much about this, but there is something called the Earned Income Credit that your wife might qualify for.

As someone suggested, cut expenses to the bone. Whenever you think of buying something, ask yourself if you need it or just want it.

Your kids are probably adults. Can each of them chip in a little each month for awhile?

nervouscorps
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Re: Newly Disabled and Need Good Advice

Post by nervouscorps » Sun May 14, 2017 6:34 pm

I'm disabled and have been through the SSDI process. My advice is get a lawyer who exclusively does disability law or SSDI claims. I went through the process at the same time as my aunt who got denied at the administrative law judge level and I believe it was because her lawyer was one that did "a little bit of this a little bit of that" and ended up submitting documents from acupuncturists, massage therapists, etc rather than MDs. While 95% of claims are ultimately approved, you don't want to risk it.
Another thing you may want to look at is Able Accounts. Not sure they would help but this is something I am looking at now. Best to you and take care.

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