Understanding the Transition Landscape
The transition from high school involves more than just graduation. It marks a shift in services, responsibilities, and expectations. According to the Family Guide to Transition Planning1 by the Technical Assistance Partnership at Cornell University, students with disabilities benefit significantly when families and educators collaborate on transition planning. This includes preparing for employment, post-secondary education, and independent living.1
Key Financial Considerations
- Education and Skill Development: Many individuals with disabilities pursue further education or vocational training after high school. While some universities offer inclusive programs for students with intellectual and developmental disabilities, costs can be expensive. Planning for tuition, transportation, and support services is essential.
Some states offer scholarships or tuition waivers for students with disabilities, and federal programs like Vocational Rehabilitation (VR) services can help cover costs related to education and training. Additionally, certain educational expenses may qualify as medical deductions if they are part of a therapeutic program designed to help the student overcome a disability.
- Employment and Income: Securing employment is a major milestone in the transition to adulthood. However, individuals with disabilities may face barriers such as limited access to job training or workplace accommodations. Programs like the Ticket to Work initiative through Social Security Administration, and local employment support services can provide guidance and resources.
It’s also important to understand how earned income affects eligibility for public benefits. For example, Supplemental Security Income (SSI) has strict income limits, and exceeding them could result in reduced or lost benefits. Families should explore work incentive programs and consult with benefits counselors to navigate these rules.
- Housing and Independent Living: Living independently often requires financial support for rent, utilities, and daily expenses. Government programs such as Section 8 housing vouchers and state-level disability housing assistance can help offset costs. Planning should also include considerations for accessibility, safety, and proximity to support networks.
Generally, you must be Medicaid eligible to qualify for a Home and Community-Based Services (HCBS) waiver, which funds many residential placements and supports people with disabilities
- Healthcare and Insurance: Healthcare needs can be substantial for individuals with disabilities. Medicaid and Medicare can provide essential coverage, but eligibility and benefits vary by state.
Medicare provides hospital and medical insurance to people with a disability who have received Social Security Disability Insurance (SSDI) for 24 months or have End-Stage Renal Disease (ESRD) or ALS (Amyotrophic Lateral Sclerosis). In contrast, Medicaid is a needs-based program for people with limited income and resources, which can include adults and children with disabilities.
A person with a disability can have both Medicare and Medicaid, a status known as being "dually eligible". People who qualify for both programs have their Medicare costs paid first, while Medicaid acts as a secondary payer to cover costs and services Medicare doesn't. Dually eligible individuals can get their health coverage through a Fully Integrated Dual Eligible Special Needs Plan (FIDE SNP) or other types of Medicare Advantage Plans designed for people with disabilities.
- Transportation and Social Engagement: Transportation is often overlooked, but critical for accessing education, employment, and community activities. Whether through public transit, paratransit services, or private arrangements, transportation costs should be factored into financial planning.
Social and recreational engagement is equally important. After leaving the structured environment of school, individuals may experience isolation. Planning for social programs, clubs, or community centers can help maintain mental and emotional well-being.
Other Planning Considerations
ABLE Accounts: ABLE can be part of the solution for key financial considerations. The Achieving a Better Life Experience (ABLE) Act allows individuals with disabilities to save money in a tax-advantaged account without jeopardizing eligibility for public benefits.
ABLE accounts can be used for qualified disability expenses such as housing, education, healthcare, and transportation. They offer flexibility and autonomy in financial planning and are available in most states.
In 2025, individuals can contribute up to $19,000 annually to an ABLE account,2 an increase from the $18,000 limit in 2024. If the beneficiary is employed and does not participate in their employer’s defined contribution plan: such as a 401(k), profit-sharing, 403(b), or 457(b) plan, they may make an additional contribution. This extra amount is limited to the lesser of their annual compensation or the U.S. poverty limit from the previous calendar year: $15,060 for most states, $17,310 for Hawaii, and $18,810 for Alaska.
The total amount that can be held in an ABLE account is subject to each state’s cap for traditional 529 Plans, which ranges from $235,000 to $596,925 in 2025. Importantly, up to $100,000 in ABLE account savings is excluded from Supplemental Security Income (SSI) resource calculations, meaning it will not affect SSI eligibility. If the account exceeds this $100,000 threshold, SSI is suspended, but Medicaid benefits remain unaffected.
SSI and SSDI: Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) are cornerstone programs for individuals with disabilities. SSI provides monthly payments based on financial need, while SSDI is based on work history and contributions to Social Security.
Eligibility for these programs can be complex, and benefits may be affected by income, assets, and living arrangements. Families should consult with Social Security representatives or disability advocates to understand the nuances.
Legal and Estate Planning: Legal and estate planning helps ensure that individuals with disabilities are protected and supported throughout their lives. Key components include:
- Special Needs Trusts: Protect assets while maintaining eligibility for public benefits.
- Advanced Medical Directives: Outline healthcare preferences.
- Guardianship and Alternatives: Designate decision-makers or supported decision-making for financial and medical matters.
Families should work with attorneys who specialize in special needs planning to create comprehensive plans tailored to their needs.
Building Financial Literacy: Financial literacy empowers individuals with disabilities to make informed decisions. The U.S. Department of Labor’s Office of Disability Employment provides a toolkit guide, The Securing Your Financial Future Toolkit (www.dol.gov/agencies/ebsa/secure-your-financial-future), for individuals with a disability with best practices and resources to address common financial concerns during each of the five stages of the employment lifecycle. The five stages of employment include preparing for a job, starting a job, maintaining a job, changing or losing a job, and even planning for retirement.
Conclusion
Transitioning from high school is a significant step for individuals with disabilities, and proper planning plays a crucial role in ensuring a smooth and successful journey. By leveraging government resources, understanding benefit programs, and engaging in proactive planning, families can build a foundation for independence and well-being.
Whether through ABLE accounts, vocational training, or legal safeguards, the tools are available, but navigating them requires collaboration, education, and foresight. With the right support, individuals with disabilities can thrive in adulthood and achieve their goals.
References
1. Family Guide to Transition Planning: Preparing Students with Disabilities for Life After High School, https://osepartnership.org/ pd/T225-Family_Guide_to_Transition_Planning_508.pdf
2. https://www.ablenrc.org/able-account-contribution-limits-2025
SpecialCareSM is a program created by MassMutual that provides access to information, specialists and financial solutions to people with disabilities and their families. For more information about Massachusetts Mutual Life Insurance Company (MassMutual) and its SpecialCare program, please visit www.massmutual.com/specialcare.
The information provided is not written or intended as specific tax or legal advice. MassMutual, its subsidiaries, employees, and representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel.
ABOUT THE AUTHOR:
Kelly Piacenti is Head of MassMutual’s SpecialCare program with nearly 500 Special Care Planners. She oversees partnerships with some the largest national special needs non-profit organizations and serves on the National Board of Directors for United Cerebral Palsy. She also serves on the Advisory Board for The Academy of Special Needs Planners, as well as The American College Center for Special Needs Planning. Kelly often lectures at industry conferences and is published and quoted in numerous industry publications for the special needs community. She has four children and was the mother of a son with special needs for 19 years.
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