How to Live on Disability Allowance

It is important to learn to live off of your disability allowance if it is your only income.

Whether you receive a disability allowance from the government, a previous employer or an insurance company, the allowance is usually only a fraction of the income you previously received. This decreased income can make it exceedingly difficult to maintain the same lifestyle especially if it is the only income that supports your household. To survive on your allowance, you must learn to identify and analyze your expenses, research methods to reduce expenses and learn to make decisions that will decrease your spending without effecting your quality of life.


Step 1

Write down all of the expenses that you currently have. Include fixed expenses such as rent, car payment, insurance, average utility costs and phone service. Make a separate list of irregular annual expenses such as medical costs, car and home repairs and property taxes. Divide the irregular expenses by 12 and add this total to your fixed expenses. This number represents the money you need each month. Your total income should be equal or greater to this number.

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Step 2

Sign up for all government programs for which you qualify. Many times if you qualify for disability income, you will also automatically qualify for other services such as free medical care, food programs, utility assistance and income-sensitive housing. By being placed in multiple programs, you can drastically reduce your monthly expenses.


Step 3

Liquidate assets. If you own your own home, it may be more financially feasible for you to sell the home and then give yourself monthly allotments from the sale to cover your new rent and other needs. If you will not be driving, you should sell any vehicles you have. Low cost or free transportation services are provided to the elderly in many areas. If you are not old enough to receive these benefits, you can consider using public transportation or carpooling. Compare this cost of transportation to the cost of paying a car payment, insurance, parking, repairs and fueling costs to determine which method is more affordable and feasible for you.


Step 4

Inspect every line of your remaining expenses. Research methods to reduce these expenses. Go to My Rate Plan to compare cell phone plans. You may discover that you can use a cheaper service from another company to cut down on your monthly telephone expense. Cut your land line phone if you have a cell phone. Transfer any credit card balances to the card with the lowest interest rate.

Step 5

Live below your means. If your monthly allowance is $1000, try to live off only $900 of that and save the other $100. Reduce your spending by not shopping as much and go for free activities instead of opting for expensive establishments. Try your library and local parks for free entertainment included video rentals, computer usage and possibly free outdoor concerts. Use coupons at the grocery store. Buy second hand clothing at Goodwill. Try Freecylce if you need an item, but you do not have the money to buy it.

Things You'll Need

  • Notebook

  • Pencil

  • Calculator

  • Computer

  • Contact information


Report any changes to your income to the social security administration if you receive your disability allowance from it. Note that your disability insurance allowance may be lowered or canceled if you have a certain amount of increased income. Contact your local social security office for specific information pertaining to your state.