People on ODSP should not be expected to take a vow of poverty.

As an advisor, I work with many people on the Ontario Disability Support Program (ODSP), which is Ontario’s social assistance program offering income support for people with disabilities who are in financial need.

The number of Ontarians with disabilities who require income assistance is staggering.  At least 25% of people with disabilities between the ages of 18 and 64 in Ontario are on ODSP.  There are more people on ODSP than there are people on Ontario Works – the equivalent for people without disabilities. Let me say this again.  There are more people with disabilities on social assistance than their counterparts, yet people with disabilities make up only 15% of the population.

I get it, ODSP is there for people with disabilities who are in financial need.  It is a social benefit, offering an income to those who are struggling.  However, the amount offered is difficult to live on, especially in an urban centre like Toronto where the cost of living is high.  Many of my clients receive approximately $1,170/month from ODSP.   If ODSP is a person’s only source of income, the financial struggle is far from over.  In some ways, ODSP is like throwing a life preserver to a person out at sea, but not pulling them to shore to join the rest of us.  Enough to stay afloat, but not enough to escape the rough seas.

To qualify for ODSP, you first have to demonstrate a financial need. As a single adult, you can’t have more than $40,000 in assets, although there are some exceptions. You can own your own home and a car and there are some investments you are allowed to have, such as the RDSP, but the restrictions are, well, restrictive.

I am not suggesting that ODSP income benefits be increased, at least not in this post.  My focus is the asset restrictions.  People on ODSP are concerned about exceeding the $40,000 limit.  If they do exceed the limit, their ODSP can be revoked for an extended amount of time, if not permanently.  There are ways to legitimately supplement ODSP income without jeopardizing it, but it is not straight forward or easy to understand how.  There is no roadmap and just because you are on ODSP, does not make you an ODSP expert.  People on ODSP are constantly worried about what they are allowed and not allowed to do for fear of losing the monthly income.

Currently, people are allowed to accumulate savings in a Registered Disability Savings Plan (RDSP), without it affecting their ODSP.  They are also allowed to have up to $100,000 in segregated funds or an inheritance trust, combined.  Simple and straight-forward?  Not really.  The RDSP has got to be the most generous savings plan ever offered by the federal government; it also happens to be the most complex and thus misunderstood.  The government will generously contribute up to $90,000 to a person’s RDSP over a lifetime, but the contribution formulas and early withdrawal penalties make your head spin.  And what is a segregated fund anyhow??? Okay, I know what it is.  I sell and manage them, but I can’t tell you how many people I talk to don’t know what they are.

My point is this.  It should be a little bit easier.  I didn’t say it should be easy.  I simply think it should be a little bit easier for people to understand how to supplement their ODSP without jeopardizing it.  People with disabilities have enough challenges as they navigate a society that really has not been designed with them in mind.  Can we not make ODSP a little more straight-forward so those on it can improve their financial situation and join the rest of us?  Or are we saying that people on ODSP must also deal with a system of rules and regulations that are more complex than what they would otherwise have to follow?

How we treat the marginalized is a profound reflection of how we are doing as a society.  If we are not going to increase the amount a person can receive from ODSP, let’s make the rules a little bit easier…at least a little bit easier to understand.

Note: Figures updated for 2019

Read the follow up article – ODSP It Shouldn’t Be So Complicated Part II

You may also want to read:

An Open Letter to ODSP Caseworkers

Segregated Funds Saved My ODSP

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