How to budget when you have a child with special needs | finder.com

Budgeting for life when your child has special needs

Secure the best opportunities by budgeting for the resources your child needs — both now and in the future.

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Raising a child with special needs presents many rewards and unique challenges. From medical bills to the cost of caretakers and educational therapists, the expenses that come with caring for your child’s needs can quickly stack up.

Learning how best to budget for your child’s future can prepare your family for success on the road ahead.

Financial preparation before baby comes

A prenatal diagnosis of a potential disability in your unborn baby can come as a shock. But keep in mind that the earlier you receive a diagnosis, the sooner you’re able to prepare.

Learn what you can from your doctor or specialist about your baby’s condition. Have your partner or a close family member accompany you to lend a second set of ears and take notes.

Some babies with special needs need to stay in the hospital under observation for a few extra days to ensure the stability of their health before going home. Resources like Ronald McDonald House Charities can provide a place for you to stay near the hospital at little to no cost.

Once home, you may find an extra pair of skilled hands a comfort in caring for your baby. Recruiting the help of a pediatric nurse can alleviate some of the anxiety in administering the specialized care your baby needs.

Also look into baby accessories that can help you keep an extra vigilant eye on your little one, such as a two-way video baby monitor or an Owlet Smart Sock, which tracks your infant’s heart rate and oxygen levels while they sleep.

What expenses do I need to be ready for?

Parenting a child with special needs is both rewarding and challenging. One challenge is that of budgeting for the expenses associated with specialized care and equipment for your child.

Possible expenses involved in raising your child include:

  • Accessibility. If your child has a physical disability that prevents them from accessing basic necessities around your home — such as the front door, the sink, the shower, the toilet or their bed — you may want to invest in adaptive equipment and accessibility devices like a wheelchair ramp, wheelchair lift, shower chair or service animal.
    • Healthcare costs. Depending on their condition, your child will likely require routine checkups and examinations from medical specialists, and may occasionally need to spend the night under supervised hospital care. Over-the-counter medications and mobility aids could also be a factor.
      • Specialized daycare. If you and your partner will both return to work, you’ll need to scout out a viable daycare service that can cater to the needs of your child.
      • Education. While the Individuals with Disabilities Education Act ensures that your child with special needs is entitled to an individual education program and resources that accompany it, this support typically ends at the age of 21. College tuition fees and the cost of accessibility aids can quickly mount.
      • Transportation. Should your child require a wheelchair or other mobility aid that prevents them from riding in a standard vehicle or school bus, you might need to look into purchasing or renting an adaptive vehicle or securing the services of a local transportation program.
      • Reduced income. Caring for a child with special needs can be a time-intensive task, and you or your partner may need to skim back on the number of hours you’re working to care for your child.

      Average expected costs

      About 5% of all school-age children in the US are diagnosed with a disability that includes developmental disorders, difficulty seeing or hearing and those with some form of cognitive impairment.

      The average expected costs for five of the most common disabilities found in American children vary, given the care, education and other support necessary for quality of life.

      Autism spectrum disorder (ASD)
      • Health care. Healthcare costs typically exceed that of a child without ASD by an average of $4,100 to $6,200 a year, according to the Centers for Disease Control and Prevention.
      • Individual therapists. Many ASD behavioral therapists charge from $100 to $200 an hour, with some children requiring 10 or more hours of weekly therapy.
      • Communication devices. If your child has difficulty speaking, you may need to invest in a speech-generating device like DynaVox, which can cost upward of $8,000.
      Attention-deficit/hyperactivity disorder (ADHD)
      • Health care. Children typically require prescription medication, regularly scheduled evaluations and check-ins with specialists to monitor their condition, with average annual costs coming in at $2,700 per child.
      • Education. Factoring in occupational speech and physical therapy, as well as special education programs, the average annual costs for education typically fall between $2,222 and $4,690.
      Cerebral palsy
      • Health care. Medical expenses can include hospital stays, physical therapy and doctors visits, averaging up to $16,800 a year.
      • Mobility device. To get around, your child might need a mobility device. Walkers range from $30 to $50, manual wheelchairs cost from $150 to $400 and powered wheelchairs typically cost around $7,100.
      • Home modifications. You might want to make your home more accessible for your child, widening hallways or installing a hand-held shower or a bathtub with a door. A wheelchair ramp can cost anywhere from $3,500 to $8,000.
      Down syndrome
      • Health care. A study published by the National Center for Biotechnical Information discovered that the medical costs associated with caring for a child with Down syndrome can be $4,287 a year. These costs include hospital visits, prescription medications and doctors appointments.
      • Occupational therapist. An occupational therapist can help your child develop fine motor skills, learn self-care and develop their communication. An initial evaluation can cost up to $200, while subsequent sessions ranging from $100 to $400 an hour.
      Spina bifida
      • Health care. Medical care includes medical examinations, hospital visits, laboratory tests and prescription medications, adding up to an average $14,070 a year.
      • At-home nurse. A postpartum nurse or infant-care specialist might be good to have around in the first few weeks after the birth of your baby. These nurses can clost between $20 and $25 an hour.
      • Mobility device. While some children with spina bifida are able to move with the minimal assistance of canes or crutches, others require a walker or wheelchair. Manual wheelchairs range from $150 to $400, with powered wheelchairs costing about $7,100.

      What is an ABLE account — and how can it help me?

      The Achieving a Better Life Experience (ABLE) account is a tax-advantaged, state-run savings program specially designed for children and adults who have a disability.

      Contributions to ABLE accounts are exempt from federal income tax as long funds are spent on qualified expenses, such as job training, specialized education and housing costs.

      While not all states offer ABLE accounts, many states that do allow for out- of-state applicants. Some ABLE account contributions are also eligible for state income tax deductions.

      Government resources

      The potential costs associated with specialized care for your child might sound daunting. But government programs designed to help alleviate the financial strain of caring for a child with special needs include:

      • Supplemental Security Income (SSI). This needs-based government-funded program helps people who have with a long-term disability that prevents them from financially supporting themselves. Payments are issued monthly and are based on the federal benefit rate, which in 2018 was $750 a month for individuals.
      • Social Security Disability Insurance (SSDI). This program is available to those who have a disability but have worked for a specified number of years and earned qualifying “work credits.” Eligible SSDI applicants are younger than 65 and have paid Federal Insurance Contributions Act premiums while working.
      • Individuals with Disabilities Education Act (IDEA). Enacted in 1990, IDEA entitles all children with special needs to an individualized education program (IEP), free and appropriate public education, appropriate evaluation and procedural safeguards.
      • TRIO. This collection of student services is run and funded by the US Department of Education, designed to help students with special needs and those from low-income backgrounds access the support and resources they need to succeed in their postsecondary studies.

      Compare savings accounts

      Name Product Interest rate (APY) Fee Minimum deposit to open
      2.30%
      $0
      $100
      A super-high interest rate if you're in the habit of saving at least $100 per month or have $25K in the bank.
      2.10%
      $0
      $0
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      Betterment Everyday Savings
      Betterment Everyday Savings
      2.44%
      $0
      $10
      At a 2.44% APY if you join the waitlist for Betterment Everyday Checking or 2.19% if you don't, this is a high-interest FDIC-insured savings account seamlessly tied into Betterment's investment robo-advisor.
      0.01%
      $5 per month
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      $0
      Get a $150 bonus when you open a new Chase Savings account, deposit a total of $10,000 or more in new money within 10 business days and maintain a $10,000 balance for 90 days.
      2.25%
      $0
      $100
      With an APY of up to 2.25%, it's UFB Direct's highest-yielding savings account.
      2.00%
      $15 per month
      (can be waived)
      $25
      Earn one of the highest annual percentage yields (APYs) if you live in one of 42 eligible states, and access your money by ATM, check or bill pay.
      2.25%
      $10 per month
      (can be waived)
      $5,000
      Enjoy the security and earning potential of a savings account while maintaining the flexibility to write checks.
      2.15%
      $0
      $0
      Earn one of the highest interest rates without the fees.
      1.85%
      $0
      $100
      Reach your savings goals with a CIT Bank Money Market account. $100 minimum opening deposit.
      1.05%
      $0
      $5
      An app for saving and investing. Built for two.
      1.00%
      $2.99 per month
      (can be waived)
      $0
      Digit analyzes your spending and automatically saves an appropriate amount every day so you don't have to think about it.
      0.10%
      $3 per month
      (can be waived)
      $10
      Saving for something special is fun. Qapital helps you get there faster with goals and rules. Plus, you can even team up with others to reach joint goals.
      2.02%
      $25 per month
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      $25,000
      Earn 2.02% APY for 6 months on an MMA. Conditions apply.
      2.32%
      $0
      $1
      A first step in helping you build a free financial plan for the life you want and automate your investments at a low cost.
      2.40%
      $0
      $0
      My Savings Direct offers flexibility, freedom and security in personal banking.
      2.20%
      $0
      $1
      Get one of the highest interest rates available without high balance requirements or fees.
      2.20%
      $0
      $1,000
      With no maintenance fees, it's easy to grow your savings. Put your money to work with an online account from CIBC Bank USA.
      2.10%
      $0
      $25,000
      A PurelyMoneyMarket account allows you to keep your options open while ensuring your money is working for you!
      2.36%
      $4.50 per month
      (can be waived)
      $0
      Earn 2.36% APY on your balance, but only in select states.
      2.55%
      $4 per month
      (can be waived)
      $5,000
      Competitive rate and secure access to your money via your desktop or mobile device. Interest that compounds daily.
      2.20%
      $0
      $5,000
      2.15%
      $15 per month
      (can be waived)
      $100
      This High Rate Online Savings Account requires a low minimum daily balance, making earning interest easy.
      2.15%
      $15 per month
      (can be waived)
      $5,000
      Earn interest on your higher balances while having the ability to write checks.
      2.35%
      $0
      $0
      An online savings account designed to work harder to help you achieve your financial goals.
      2.35%
      $7 per month
      (can be waived)
      $25
      A high interest savings, a short-term savings and a checking account, paired with digital money management tools – all working together to help you better manage your financial life.
      2.00%
      $0
      $10,000
      Enjoy the rewards of earning more. Smarter saving made simple
      2.35%
      $0
      $100
      With industry-leading checking and savings rates and fully insured balances, Salem Five Direct delivers competitive opportunities to save, protect and manage your money.
      2.15%
      $0
      $0
      With a money market account, you earn interest at a higher rate than with a traditional savings account. Plus, you’ll still have access to your money and can write checks from the account.
      2.15%
      $0
      $0
      A high-interest online account that pays a competitive 2.15% APY with no account fees and can hold up to $250,000.
      2.10%
      $0
      $1
      No monthly fees or minimum balance requirements, and you can even open an account with as little as $1.
      1.90%
      $0
      $0
      The most common services and transactions are free with Ally Bank.
      2.10%
      $0
      $0
      Earn 20x the national savings account average with no fees or minimums.
      2.00%
      $0
      $0
      Take advantage of a high-interest online savings account with a 2.00% APY, $0 monthly fees and more.
      2.10%
      $1 per month
      (can be waived)
      $5
      More cash in your wallet, faster, with a High-Rate Savings Account
      2.10%
      $0
      $5
      An Alliant Kids Savings Account is the perfect teaching tool on how to set savings goals.
      1.90%
      $12 per month
      (can be waived)
      $25
      A good choice for customers who want premium interest rates on their savings accounts.
      2.00%
      $0
      $0
      A high-interest, fee-free online bank account that helps you save.
      1.80%
      $0
      $1
      Make a purchase and we'll automatically roundup and put the change to work in your Wealthsimple Save account.
      1.90%
      $0
      $2,500
      Earn high yields with flexible access to your cash.
      2.00%
      $0
      $5,000
      Get the money market account that can help you save toward important financial and life goals, while providing many other perks along the way.
      1.90%
      $0
      $1
      The modern way to reach your savings goals and to live a better life – purely. Zero fees. Zero fuss.
      1.85%
      $15 per month
      (can be waived)
      $100
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      1.77%
      $0
      $5
      With no fees and a high interest rate, this account gives you plenty of incentive to save.
      1.55%
      $0
      $100
      Earn a high interest rate with no monthly fees.
      1.20%
      $0
      $0
      Easy ways to access cash.
      1.06%
      $0
      $25,000
      Earn up to 1.06% APY with no monthly maintenance fee and no daily average balance requirement.
      1.01%
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      $1,500
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      1.00%
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      A fee-free online savings account with a great rate for any savings balance.
      1.00%
      $0
      $0
      Kids Savings Accounts are fee-free and don’t require a minimum balance.
      1.00%
      $0
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      Increase your earning power. Keep your money within reach
      0.80%
      $5 per month
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      $1,000
      Earn up to 0.80% APY. Free online and mobile banking, with remote deposit anywhere.
      0.34%
      $0
      $0
      No account minimums, no monthly service fees. A 0.34% APY variable interest rate on any balance.
      0.40%
      $15 per month
      (can be waived)
      $100
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      0.30%
      $3 per month
      (can be waived)
      $100
      The convenience of banking online. Complimentary ATM card. Available as an overdraft protection
      0.17%
      $12 per month
      (can be waived)
      $100
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      0.01%
      $25 per month
      (can be waived)
      $25
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      0.07%
      $10 per month
      (can be waived)
      $100
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      0.06%
      $4.50 per month
      (can be waived)
      $0
      Your savings account will be opened within a package that determines interest rates, balance requirements, benefits and more.
      0.05%
      $5 per month
      (can be waived)
      $0
      Start building your savings today with this easy everyday account for all ages
      0.05%
      $15 per month
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      $25
      A basic savings account with mobile banking and same-day access to direct deposits.
      0.03%
      $8 per month
      (can be waived)
      $100
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      0.01%
      $3 per month
      (can be waived)
      $25
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      0.01%
      $4 per month
      (can be waived)
      $25
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      0.01%
      $5 per month
      (can be waived)
      $25
      Offers Bank of the West's lowest opening deposit and makes an easy way for you to put a little extra money away.
      0.01%
      $0
      $0
      Get paid up to 2 days early with direct deposit. Say goodbye to hidden bank fees. Grow your savings, automatically.
      0.01%
      $5 per month
      (can be waived)
      $25
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      0.00%
      $1.99 per month
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      $0
      Use spare change from everyday transactions to make an extra payment toward your debt, every month.

      Compare up to 4 providers

      Bottom line

      Making sure that your child with special needs has every opportunity and advantage they’re eligible for is a matter of planning ahead.

      Setting up a trust or ABLE savings account can providing your child with a financial safeguard for the future. And public resources — like tax credits, deductibles and funded government programs — can ease the financial strain of delivering the care your child needs to succeed.

      Read, research and connect with other families to learn more about the resources available in your community.

      Frequently asked questions

      These are some of the most frequently asked questions about this topic. If you still have questions, please get in touch with us.

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