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Raising Grandchildren: Finances

Make a budget and learn about available benefits and assistance for grandparents caring for a child

Many grandparents caring for grandchildren struggle to meet the basic needs of their families. Fortunately there are a number of state and federal public benefits programs that can help out. You may be able to get special assistance if you or your grandchildren's parent has been in the military or if a parent is deceased. There are also tax credits that may help.

See also: GrandFamilies Resources.

To find out if you or your grandchildren qualify for public benefits, you can:

  • Use AARP's Benefits QuickLINK tool to find out if you or your grandchild may qualify for 15 public benefits — 10 for adults and families and five for children. Simply answer a list of questions about your family income, assets and any help with finances you get now. The tool gives you a report listing the benefits you may qualify for and links to the application forms.
  • Visit GrandFacts sheets for information about your state that includes contact information for your state agencies. The state agencies can help you find out whom to talk to in your county.
  • Talk to a worker in your county who deals with public benefits. Different offices may handle the various public benefits. You can start with the social worker or counselor at your grandchild's school, or look for any of the following:

o  Department of Social Services or Human Services

o  Department of Children and Family Services or Youth Services

o  Health Department

o  Child Welfare Office

o  Social Security Office

o  Department of Aging

o  Women, Infant and Children Program (WIC)

Can my grandchildren qualify for benefits based on their income only?

Yes, there are public benefits that are based only on your grandchildren's income. A child's income may include such things as a trust fund or child support payments. Cash help from Temporary Assistance for Needy Families (TANF), a federal public benefit program, is available for families based on their household incomes, or for a child based only on his/her income (sometimes called a "child-only grant"). Other benefits your grandchild may qualify for include: Supplemental Security Income (SSI) for children with disabilities; Medicaid health insurance, or your state's Children's Health Insurance Program (CHIP) if your grandchildren don't qualify for Medicaid. The Benefits QuickLINK tool has every state's rules for such programs as TANF, CHIP, Medicaid, SSI and the Earned Income Tax Credit (EITC) built-in, so you don't have to take the time to find out about all of those rules on your own.

Do I have to have legal custody or guardianship of my grandchildren to apply for public benefits or get tax credits?

You do not need have a formal legal relationship with your grandchild to apply for some public benefits or tax credits, including EITC, the Child Tax Credit, Medicaid, a TANF Child-Only grant, and others. But some public benefits do require that you get custody or guardianship. Many states have Subsidized Guardianship Programs that have cash payments to help with the costs of raising a child who has been in the foster care system. In some states you may have to have been the child's foster parent yourself before getting legal guardianship to get the Guardianship Subsidy. Check with your county child welfare agency to find out how it works in your state.

If I adopt my grandchild, is there financial help to raise him/her?

All states have "Adoption Assistance" for children who are adopted when they have been in the child welfare system (foster care) and have "special needs". Every state defines special needs differently, and may or may not include children who are part of a group of brothers and sisters, is older, belongs to a minority group, or has physical or mental/emotional disabilities. Contact your child welfare agency to ask about the rules in your state.

Can I get child support payments from my grandchild's parent?

You may be able to get child support payments to help raise your grandchild. Talk with a family law lawyer about getting child support if you go to court for custody or guardianship. Learn about the pros and cons of child support in terms of finances and also the effect on your grandchild's parent. The Office of Child Support Enforcement may also be helpful.

I need to work. Can I get help to pay for child care?

Every state has a child care subsidy program that helps pay for child care for families with lower incomes who meet the guidelines for eligibility. You will need to contact your state or local child care government office and fill out a form. The income, work, age of the child and other requirements vary from state to state, so you'll need to find out what the rules are in your state.

Next: Grand Families Guide: Work