Deanna Starts Saving Money in a PASS

On her first day of work at the women’s shelter, Deanna’s new employer gave her a lot of papers to fill out, including stuff about benefits for full-time employees, but Deanna was just working part-time, so there were no benefits for her. She thought about how nice it would be to someday work full-time and get all those benefits, make more money, and maybe even be able to buy a home one day, but then she got back to doing her paperwork. She figured that this job would just be the first step toward fulfilling her dreams.

While Deanna spent some of her new income on living better, she also was able to put a little of it away in a bank account. Her goal was to save up $125 a month from her job, and she was doing well. By the time she had been working at the shelter for a year, she had put away $1,500.

That March, Deanna turned 30 and she realized that if she wanted to fulfill her dream of buying her own home, she’d have to save up a lot more than $1,500. But how would she earn enough money to really start saving money and buy a house if she didn’t even have a full-time job?

Deanna needed to figure out a plan that would help her achieve her goals over the long-term, so she decided that she needed to talk to the Consultor/a de incentivos de trabajo again. She called up Ruth at Ability 360 one afternoon and scheduled a meeting for the following week.

When Deanna went in, she took documentation about her work income, her benefits, and her bank account. After Ruth looked them over, she commented, “It looks like you’ve saved up $1,500 so far. That’s a good start, but it’s probably not enough to buy a house yet. There are 2 things for us to think about: you are getting close to SSI’s resource limit and you have to come up with a way to earn more money over the long-term.”

Deanna nodded.

“Fortunately,” continued Ruth, “Social Security has a program for people on SSI that lets them save up more money than SSI usually allows so they can meet a professional goal.”

“Really? And I wouldn’t lose my SSI?” asked Deanna.

Ruth smiled, “Yes, in fact, your SSI benefit will even go up.”

Ruth then began explaining how Social Security’s Plan to Achieve Self-Support (PASS) program worked. It lets people on SSI save money in a special account that isn’t counted as part of a person’s resources or income.

“For example,” Ruth said, “You currently make $1,200 per month at your job, which for SSI is $557.50 in countable income. If you put that $557.50 into a PASS, SSI would no longer count that money as income, so you’d have no countable income and your SSI benefit would go up to the maximum possible benefit amount, $943 per month. After just 4 months, you’d have more than SSI’s resources limit saved up, but since the money is in a PASS account, you’ll keep getting SSI. What you need to do is come up with a professional goal that will help you earn more, so that you can meet your long-term goal of buying a home. Have you thought at all about what sort of job you’d like in the future?”

Deanna thought for a moment. “Well, my boss at the shelter has been encouraging me to get a master’s in social work. She thinks it would be a great way for me to get a job as a counselor for women who have faced domestic violence. I really love the work I do, helping people, and I think her idea is splendid. The only problem is that I can’t really afford to get the master’s degree.”

Ruth cut in, “A master’s degree so that you can get a better job as a domestic violence counselor is a great professional goal for your PASS.” She then explained that Social Security’s PASS Cadre could help Deanna write up a detailed plan and fill out the application form: “The plan will have to explain how the money put into the PASS will help you with your goal. In this case, your plan will state that the money in your PASS account will help you pay for your education. Social Security will look at your plan, and if they think it’s viable, your PASS will be approved. After it’s approved, you have to follow your plan, put away the money, and then go get your degree. And of course, once you have your degree, you’ll be able to get a job that pays more than $1,200 per month and you’ll be able to save up money to make a down payment on your own house.”

Ruth continued, “So, let’s say your PASS is approved by Social Security and you start putting $557.50 each month into the PASS account.” Ruth got out a piece of scratch paper and started scribbling numbers and equations as she spoke.

“Here you go,” Ruth concluded. “Take a look at this and tell me what you think. This is the amount of countable income you’ll have if you get a PASS and put $557.50 into the account each month.”

Ingresos contables de Deanna (con PASS)

Ingresos no ganados mensuales de Deanna	$0.00
Ingresos ganados mensuales de Deanna	$1,200.00
Menos la parte sin utilizar de la Exclusión General de $20	- $20.00
Menos la exclusión de ingresos ganados de $65	- $65.00
Menos los gastos IRWE de Deanna	- $0.00
Subtotal
Dividir por dos	÷ 2
Subtotal
Menos la contribución mensual de Deanna al plan PASS	- $557.50
Ingresos ganados de Deanna

Since her countable income was down to zero, Deanna’s SSI benefit would go up to $943 per month.

Ingresos totales de Deanna (con PASS)

Tasa del beneficio federal	$943.00
Menos el total de los ingresos contables	- 0.00
El beneficio de SSI de Deanna
Ingresos ganados mensuales de Deanna	+ $1,200.00
Ingresos no ganados mensuales otros de Deanna	+ $0.00
Ingresos mensuales totales de Deanna

Deanna lost her breath for a moment. “Wait,” she finally mustered, “does that mean that even though I’m making the same amount of money at work and even though in a few months my resources will go over SSI’s normal resources limit, I’ll keep getting SSI and my monthly benefit will actually go up? That sounds like magic!”

Ruth’s eyes twinkled. “Yes. Good stuff, isn’t it? Your gross monthly income will now be $1,200 from work plus $943 from SSI for a total of $2,143. You’ll be putting $557.50 of that each month into your PASS account to pay for school, so you’ll have $1,585.50 left over for your living expenses, the same amount to live on while using the PASS as you do now. And you’ll keep getting Asistencia Nutricional as well, because as long as you get SSI, you don't need to worry about Asistencia Nutricional's income limit.”

Deanna had one final question to ask: “What will happen with my AHCCCS coverage? Will this extra income interfere with that?”

“Not at all. You'll still be on SSI, so you'll still get AHCCCS automatically.”

And so Deanna contacted the PASS Cadre. They asked her to apply for financial aid to see if she could get some grants or scholarships to help pay for school, in addition to PASS. Deanna applied and was surprised to learn that she was eligible for financial aid and would get most of her schooling costs covered that way. But the financial aid wasn’t enough to cover all the expenses, so the PASS Cadre helped Deanna fill out the PASS application.

Once approved, Deanna started saving up $557.50 each month, and in return she started getting a $557.50 increase in her SSI benefit. By September, Deanna had more than $3,300 in her PASS and she could afford to begin graduate school part-time, while continuing her part-time job at the shelter. To pay for school and her books not covered by financial aid, she used the money she had saved in her PASS account. And little by little, she got closer to finishing her degree, getting a better paying job, and being able to buy her own home.