Financial Resources To Help Low-Income Seniors When Inflation Is High

Inflation, or a general increase in prices, reduces your purchasing power. In other words, a dollar doesn’t stretch as far as it used to, leaving you unable to buy the same items with the same amount of money. For seniors living on Social Security and other retirement benefits, inflation makes it even more difficult to cover the costs of many essential items.

Although the Social Security Administration made a large cost-of-living adjustment for 2022, not everyone can afford to live on Social Security alone. In the first half of the year, the Dow Jones Industrial Average lost 15.9% of its value. The S&P 500 and NASDAQ indices fared even worse, declining by 21.1% and 30.3%, respectively. If you rely on stock market returns for some of your income, that means you have less money coming in just as prices are skyrocketing.

Pension funds typically don’t make cost-of-living adjustments, but even when they do, the increase is usually only about 2% or 3%. As of July 2022, the 12-month inflation rate was 8.5%. Even if your pension benefits increased by 3%, that’s not enough to keep up with rising prices.

We created this resource to help low-income older adults during these hard financial times. This guide provides an overview of more than a dozen national programs that offer benefits to help seniors cover the cost of necessities. For each program, we’ve provided a detailed explanation of the eligibility requirements and how to apply.

Energy costs make up a substantial portion of some seniors’ budgets, especially in states known for harsh winters and hot summers. Average retail prices range from 7.51 cents per kilowatt hour in Louisiana to 27.55 cents per kilowatt hour in Hawaii, according to the U.S. Energy Information Administration.

Annual energy consumption for an average household is 893 kilowatt hours per month. Even at the lowest rate of 7.51 cents per kilowatt hour, that’s just over $67 per month in utility costs. The programs below help eligible participants pay their energy-related expenses.

The Weatherization Assistance Program uses federal funds to help homeowners and renters increase the energy efficiency in their homes. Increased energy efficiency leads to lower heating and cooling costs, making the WAP a helpful resource for seniors looking for ways to save money.

Eligibility Guidelines

You may be eligible for WAP if you meet at least one of these criteria:

• Your income is at or below 200% of the Federal Poverty Level (FPL). 
• You already receive Supplemental Security Income (SSI) benefits.
• Your income is at or below 60% of your state’s median income.

Application Details

Find your local weatherization provider on the Department of Energy website. Contact the provider to begin the application process. You’ll need proof of income to get started.

The Low-Income Home Energy Assistance Program helps eligible participants catch up on past-due energy bills or address energy-related crises. For example, LIHEAP participants may be able to use program funds to purchase heating fuel in the winter.

Eligibility Guidelines

You may qualify for LIHEAP if you meet at least one of these criteria:

• Your income is at or below 150% of the FPL.
• You already participate in the Supplemental Nutrition Assistance Program (SNAP).
• You receive benefits from Temporary Assistance for Needy Families.
• You already receive SSI benefits.
• Your income is at or below 60% of your state’s median income.

Application Details

LIHEAP uses federal funds, but those funds are distributed at the state level. Get in touch with your state’s LIHEAP office for more information.

Some programs are available to help seniors reduce the amount they owe in taxes. The deductions and credits below apply to your federal income taxes.

The Tax Credit for the Elderly or Disabled (TCED) reduces your tax burden by $3,750 to $7,500, depending on your filing status and other circumstances.

Eligibility Guidelines

You must meet one of the following sets of criteria to qualify for the TCED:

• You’re aged 65 or older and have income that doesn’t exceed the annual maximums.
• You’re on permanent total disability, have income that doesn’t exceed the annual maximums and received taxable disability income during the year.

Many programs have a single income limit, but to qualify for the TCED, you must clear two income-based hurdles. The first is the adjusted gross income (AGI) limit, which is $17,5000 to $25,000 per year, depending on your filing status. The second is the limit for non-taxable benefits, which ranges from $5,000 to $7,500 depending on how you file your federal return. Non-taxable benefits include Social Security benefits, disability benefits and pension payments.

Application Details

To take the TECD on your federal return, fill out Schedule R and submit it with your 1040 or 1040-SR. When the IRS releases the 2022 versions of these forms, they’ll be posted in the Forms, Instructions and Publications section of the website.

When you file your federal return, you have to decide whether to take the standard deduction or itemize your expenses. Taking the standard deduction is far more common, but if you have significant medical expenses, itemizing may help you lower your tax burden. Any medical expenses you deduct must be associated with at least one of the following:

• Diagnosing a medical condition
• Preventing a medical condition
• Treating a medical condition
• Mitigating the effects of a medical condition
• Treating a structure or function of the body

According to these guidelines, many types of medical expenses qualify, including prescriptions, outpatient doctor visits, inpatient hospital care, eye care, dental care and medical transportation. If you plan to itemize, save your receipts in case you have to prove you incurred these expenses.

Eligibility Guidelines

You can only itemize your medical expenses if they exceed 7.5% of your AGI for the year.

Application Details

Download a copy of Schedule A from the IRS website. Use the worksheet to add your medical expenses and compare them to your AGI. When you’re calculating the total, remember not to include expenses that were reimbursed by your employer or insurance company.

Once you determine your total medical expenses, complete the other sections of Schedule A, if applicable. You may need to fill out additional sections if you paid certain taxes, paid certain types of interest, made charitable contributions or need to report any casualty or theft losses. Enter your total itemized deductions at the bottom of Schedule A and then transfer the deduction to your 1040 or 1040-SR.

Schedule A for 2022 should look similar to this 2021 version. If the IRS doesn’t change the 1040 or 1040-SR for 2022, you’ll enter your total itemized expenses on line 12a of whichever form you use.

As noted above, many people use the standard deduction instead of itemizing. The amount of the standard deduction depends on which filing status you use.

• Single or married filing separately: $12,950
• Head of household: $19,400
• Married filing jointly or surviving spouses: $25,900

The standard deduction for seniors increases these amounts by $1,400 to $1,750.

Eligibility Guidelines

Any taxpayer who’s at least 65 years old is allowed to take the higher standard deduction.

Application Details

When you file your federal return, check the box to indicate you were born before January 2, 19XX*. If applicable, check the box for your spouse as well. To determine your standard deduction amount, use one of these methods:

• Form 1040: Refer to the Standard Deduction Chart for People Who Were Born Before January 2, 19XX or Were Blind.
• Form 1040-SR: Refer to the table on the last page of the form.

Once you determine the amount to deduct, enter it on the line reserved for standard deductions.

* The cutoff date changes each year to ensure that everyone who’s at least 65 can claim the senior standard deduction. For 2022, the cutoff date will be January 2, 1958.

The Earned Income Tax Credit (EITC) is available to taxpayers with low to moderate incomes. For an adult with no children, the EITC maxes out at $1,502 per year.

Eligibility Guidelines

The EITC is only available to taxpayers who have income that comes from working. If your only income comes from Social Security, investments and other forms of unearned income, you won’t be able to claim the EITC. You may be eligible for the EITC if you meet every criterion below.

• You worked (had earned income) during the tax year.
• Your earned income didn’t exceed $57,414.
• You had no more than $10,000 in investment income.
• You’re not required to file Form 2555.
• Your primary home is in the United States for at least half the tax year.
• You’re a U.S. citizen/resident alien for the entire tax year.
• You have a Social Security number.

Application Details

If you meet the above eligibility requirements, you can have the IRS figure the EITC for you or use Worksheet A to calculate it yourself. Worksheet A is included in the instructions for IRS 1040 and IRS 1040-SR.

About 40% of Americans delayed getting medical care in 2021 due to the high costs. If you have a chronic medical condition, you may need to take multiple prescription medications or see more than one specialist, increasing your medical expenses. The programs below can help by providing health coverage, reducing the cost of certain services or helping you assess your eligibility for additional benefits.

Although Medicare costs less than private health insurance, it’s not free. Unfortunately, not everyone can afford to pay their Medicare-related costs. In 2021, JAMA Network published the results of a study conducted by researchers in Boston. The researchers determined that 11% of Medicare beneficiaries struggle to pay their medical expenses. Medicare Savings Programs cover some Medicare-related costs, reducing the burden on Medicare enrollees.

Each MSP has different coverage levels. The Qualified Medicare Beneficiary (QMB) program is the most comprehensive, as it covers copays, deductibles, co-insurance and premiums for both Medicare Part A and Part B. The Qualifying Individual (QI) program and Specified Low-Income Medicare Beneficiary (SLMB) program cover Part B premiums only. Individuals enrolled in the Qualified Disabled Working Individual (QDWI) program receive help with their Part A premiums.

Eligibility Guidelines

You must meet certain income and resource requirements to qualify for an MSP. As of 2022, the SMB, QI and SLMB programs all have the same resource requirements — $8,400 for individuals and $12,600 for married couples. The QDWI program has resource limits of $4,000 for individuals and $6,000 for married couples. The income limits are outlined in the table below. Note that Alaska and Hawaii have slightly higher limits due to their high costs of living.

Application Details

MSPs are administered at the state level, so contact your state Medicaid agency for more information.

Medicaid is a health insurance program for people with limited resources. Some states offer categorical eligibility to seniors or adults with disabilities, making it possible to qualify for coverage even if your income exceeds the general Medicaid limit in your state. You can use Medicaid to cover a variety of medically necessary services.

Eligibility Guidelines

To qualify for Medicaid, you must meet these basic requirements:

• You’re a U.S. citizen or belong to an eligible immigrant category.
• You live in the state where you plan to apply for Medicaid coverage (e.g., if you apply for Washington’s Apple Health program, you must reside in Washington).

You’ll also need to meet the financial eligibility requirements for your state’s Medicaid program.

Application Details

Contact the Medicaid agency in your state for additional eligibility information and application instructions.

In 2023, Medicare beneficiaries can expect to pay an average of $31.50 per month for their Medicare Part D premiums. Once you pay the premium, you may also have to pay deductibles, copays and/or co-insurance, increasing your out-of-pocket costs. Medicare Part D Extra Help covers some of these costs, making it easier to pay for your medical expenses.

Eligibility Guidelines

Medicare Extra Help has income and asset requirements that all participants must meet. The limits depend on whether you have Medicare by itself or use Medicare with other benefits. For Medicare only, the limits are as follows:

You may also qualify for Full Extra Help if you have Medicare and Medicaid or Medicare combined with Medicaid and/or an MSP. The income limits for applicants with these benefits are as follows:

The Part D Extra Help program doesn’t have an asset limit for beneficiaries who use Medicare with Medicaid and/or MSPs.

Application Details

Call (800) 272-1213 or fill out the online application.

BenefitsCheckUp offers information on a variety of benefits programs. Seniors who use the website can also connect with enrollment specialists to ask questions or determine if they’re eligible for additional benefits.

Eligibility Guidelines

BenefitsCheckUp has no eligibility requirements. If you have internet access, you can use the website.

Application Details

Find benefit programs in your area by going to BenefitsCheckUp.org and entering your zip code.

The Food Distribution Program on Indian Reservations distributes food and federal funds to state agencies and certain Indian Tribal Organizations (ITO). FDPIR serves as an alternative to the Supplemental Nutrition Assistance Program (SNAP) for beneficiaries who live far away from SNAP offices or stores approved to accept SNAP benefits. The state agencies and ITOs determine applicant eligibility and distribute food as needed.

Eligibility Guidelines

You may qualify for FDPIR if you meet the following criteria:

• Your household has one Native American member.
• You reside on an Indian reservation, live in an approved area in Oklahoma or live in an approved area near an Indian reservation.
• You meet the FDPIR income standards.

FDPIR’s income standards are slightly higher than SNAP’s standards. A single applicant is allowed to have up to $1,251 per month in net income. The net income limit increases to $1,629 for a two-person household.

Application Details

Contact your ITO, State Distributing Agency or USDA Food and Nutrition Service Office for application instructions.

The Senior Farmers Market Nutrition Program provides $20 to $50 per month for seniors to spend on fresh produce and locally grown honey and herbs. You can use SFMNP benefits to supplement your food budget.

Eligibility Guidelines

To qualify for SFMNP benefits, you must meet both of these criteria:

• You’re at least 60 years old.
• Your household income doesn’t exceed 185% of the FPL.

Application Details

Call your state’s FNS office for more details.

SNAP covers meats, poultry, dairy products, grains and many other food items. You can’t use your benefits to pay for hot foods, most live animals, tobacco products or alcoholic beverages, however. The amount you receive each month depends on your household size and income.

Eligibility Guidelines

Disabled adults and seniors aged 60 and older must have incomes below SNAP’s net monthly income limits. These limits are as follows:

If you’re under age 60 and don’t have any qualifying disabilities, you also need to meet SNAP’s gross monthly income requirements. To qualify, you can’t have monthly gross income exceeding the following limits:

Application Details

Contact your local SNAP office for more details.

Meals on Wheels has a national network of volunteers to deliver meals to seniors who are unable to cook for themselves or leave their homes to purchase food. Some chapters also prepare hot meals and serve them in community settings.

Eligibility Guidelines

You may qualify for Meals on Wheels if you’re at least 60 years old, but each chapter operates independently, so there may be additional eligibility requirements for seniors in your area.

Application Details

Contact your local provider to ask about the full eligibility requirements and find out how to apply.

The Emergency Food Assistance Program distributes vegetables, beans, eggs and other foods to food pantries and other distributing agencies throughout the United States. These agencies then distribute the food to eligible community members.

Eligibility Guidelines

To qualify for TEFAP, you must meet your state’s financial requirements. You may also qualify if you participate in certain benefits programs.

Application Details

Call your state distributing agency to find out more about TEFAP.

If you’re able to work, getting a job is a good way to supplement your retirement income. Before filling out applications, you may want to participate in government-funded job training to ensure you have the skills needed to find gainful employment.

The Senior Community Service Employment Program matches seniors with volunteer opportunities at participating organizations. Volunteering helps a worthwhile organization and gives you a chance to develop new job skills. SCSEP participants also receive a stipend.

Eligibility Guidelines

SCSEP is open to seniors who are aged 55 and older and unemployed. Your income must also be at or below 125% of the FPL.

Application Details

Call (877) 872-5627.

These federal resources are a great start, but many states also offer benefits to help seniors pay for health care, food, utilities and other necessities. Consult the resource guide for your state to find out what programs are available and how to apply for benefits.