Three years ago, a member of the Rich Girl Community named Jenny Burke reached out to me to share a picture of herself teaching her friends about personal finance. She stood in front of a giant sticky easel with HOT GIRL SHIT scrawled in Sharpie across the top, and definitions of the 401(k) and IRA underneath it. Her friends sat scattered around a room with charcuterie boards covering every visible surface. It was love at first sight.

Jenny and I stayed in touch—and she shared with me recently that she was diagnosed with ulcerative colitis in 2011, an invisible disability that she’ll have for the rest of her life. For the uninitiated, ulcerative colitis makes it difficult to leave the house during flare-ups because one needs constant, ready access to a bathroom. 

Jenny co-founded a community called “The Inclusive Traveler” with her friend and coworker, Kelsey Ibach, who began using a wheelchair at the age of 25 after a car accident with a drunk driver left her paralyzed from the waist down.

I invited them to join me for this week’s episode of The Money with Katie Show to share more about the hidden costs of living with a disability—from the challenges of traveling to planning for medical care in retirement. Although I don’t currently live with a disability, it’s not lost on me how quickly that can change (or how expensive it can be!): One in four people in the US will become disabled before they reach traditional retirement age. 

It’s a “minority” group that the majority of people (whether through genetic preconditions, an accident, or the process of aging) will join either permanently or temporarily at some point in their lives, yet it’s a topic that’s almost wholly absent from personal finance discourse. 

In her first year after the accident, Kelsey racked up nearly $100,000 in costs just to maintain her same, pre-accident standard of living.

The driver fled the scene, but due to poor signage in the area, Kelsey was able to sue the city of Chicago to recover some of the costs associated with her accident—highlighting the way successful litigation is often one of the only ways to guarantee financial help after an accident, even if you have health insurance, like Kelsey did. (And we all know lawyers aren’t cheap; that’s why I married mine!)

The costs Kelsey outlined in our discussion may seem extreme, but they aren’t out of the ordinary:

A 2020 report from the National Disability Institute found that adults “with a work disability require an annual average of 28% more income (or an additional $17,690 per year for a household at the median income level) to create the same standard of living as a comparable household without a disabled family member,” and that working-age adults with disabilities are twice as likely to have incomes under the poverty line than those without. 

This emphasizes the way in which costs can be both direct (in the case of extra accommodations needed to live day-to-day life, like retrofitting a shower or finding accessible transportation) and indirect (in the case of employment discrimination, or when a caretaker needs to take a lower-paying job or work fewer hours to care for a family member with a disability).

Having a disability is expensive, and it’s usually something we don’t plan for

…despite the fact that most of us will be part of the disabled community at some point in our lives. Let’s break down the major expense areas that are typically impacted:

Housing

Depending on the nature of the disability and where you live, you may need to either seek out accessible rentals or renovate your home. Kelsey, for example, lived and worked in Chicago and had to pay a premium for an apartment with an elevator near accessible transportation, typically found in “prime” locations that cost more.

If you own your home and need to install a chair lift, a sit-down shower, wheelchair ramps, additional railings, and other accommodations for mobility—it can cost upward of $20,000 to cover the basics. 

Unfortunately, many insurances won’t cover these costs, despite being necessary. While you may be able to get a tax break for these updates, you’re often paying out of pocket, which highlights how crucial an emergency fund can be (and how unexpectedly you may need it).

Transportation & Travel

“Adapted vehicles” are cars modified to meet the needs of someone with a disability, and according to the National Highway Traffic Safety Administration, they can cost up to $80,000 (more than the median American earns in a year).

Many people with disabilities rely on public transportation or ridesharing, which usually means living in an urban area where public transportation is common. The cost of public transportation and rideshares combined can average about $200/mo. or $2,400/year.

And while buses and trains in major cities tend to have accommodations for disabilities, air travel is more of a crapshoot (this is part of what inspired Kelsey and Jenny to start The Inclusive Traveler). Whether it’s the process of navigating a large and busy airport, using a bathroom on a plane, or trusting untrained personnel with your accessibility devices, traveling with a disability requires a lot more forethought than I had ever considered.

Healthcare

Kelsey’s health insurance didn’t cover the cost of certain medical supplies—and many insurances don’t cover the cost of custom-fit wheelchairs, which can be necessary to retain independence.

Living with a disability often means requiring some sort of device to perform everyday functions: talking devices, canes, prosthetics, specific lighting, hearing aids, medication…the list is long! 

While some of these costs can be reimbursed by a Flexible Spending Account, Health Savings Account, or health insurance, the coverage is frustratingly spotty. According to the latest available numbers from the CDC, the average person with a disability spends $17,431 per year on the associated costs. 

And yet this doesn’t account for the actual cost of healthcare itself, from the higher insurance premiums for higher quality plans to the out-of-pocket costs for doctor’s visits, tests, and therapies. (We’ve chatted extensively about the bewilderingly obvious grift that is the US healthcare marketplace in Money with Katie World before; here’s how I’ve budgeted for healthcare costs in the past.) 

Per the Kaiser Family Foundation, the average annual premium for an individual’s healthcare coverage was $7,911/year in 2022. 

So what’s the total? (Plus, long-term disability coverage)

Everything we’ve discussed totals nearly $15,000 additional (potentially fixed) costs each year between increased housing expenses, insurance premiums, and transportation (which is in line with the estimated average around $17,000 per year).

But as Kelsey mentions in the episode, long-term disability (often abbreviated as “LTD”) insurance can help offset these costs because it replaces lost income from work. 

Expect to pay anywhere between 1%–3% of your annual income in LTD premiums. I’ll say the quiet part out loud: This stuff is not cheap, but it can be lifesaving in the event of disability. The paradox, unfortunately, is that those most in need of this type of insurance are often those most unable to afford it—but Kelsey told me her one regret was not getting it before she needed it. (So if your employer offers LTD, say yes!)

Most policies will pay you benefits up until the time you reach retirement age, depending on the details of your policy. There are usually no limitations on how the money can be spent. It can be invaluable as income replacement if you’re unable to work, as Kelsey was for many months after her accident.

There are other resources out there to support living with a disability, like Social Security, Medicare, and Medicaid, to name a few—but they’re not always comprehensive and are typically limited to those who meet fairly narrow age or income requirements.

The reality is that one in every four people will be disabled before they reach retirement age. While it’s hard to save for these circumstances specifically, it makes a great case that quality healthcare, buffered savings cushions, and long-term disability insurance are probably all worthwhile expenses.