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Student Grants and Loans May Affect Your Eligibility for Social Security Benefits

If you are a student on Supplemental Security Income (SSI), you may know that the Social Security Administration (SSA) excludes student loans, grants, scholarships, fellowships, and monetary gifts received within a 9-month period from your income calculation. But if you don’t use this money exclusively to pay the cost of tuition, fees, or other necessary educational expenses, it can go from being excluded to being counted as income.

There are three ways this can happen:

  1. If you set money aside for education but then later use it at any point within nine months after you get it to pay non-education costs—such as rent, heat, food, clothing, etc.—SSA will count the money you used for non-educational purposes as income in the month you spent the money and as a resource the following month. This is significant because if your unearned income exceeds $730 per month individually (or $1,086 as a married couple) or your resources exceed $2,000 individually (or $3,000 if married), you will be ineligible for federal benefits.
  2. If you set aside a portion of the grant/loan/scholarship/gift money for non-educational purposes within nine months after getting it, SSA will count that portion of the money as a resource.
  3. If any of your grant, loan, scholarship, or gift money remains unspent at the end of the nine months after you received it, SSA will define the unspent money as a resource, starting with the 10th month after it was received.
Be vigilant about how you use educational awards or monetary gifts to ensure you don’t become ineligible for SSI benefits.