The Crystal Hultz ruling and what changed

In 2023, the U.S. Court of Appeals for the Fourth Circuit ruled in Hultz v. Kijakazi that the Social Security Administration (SSA) had been wrongly denying benefits to people based on how they managed their money. The case centered on whether someone's spending patterns — specifically, whether they spent money quickly or held it in reserve — could be used as evidence that they were not truly disabled. The court said it could not.

The ruling matters because SSA examiners had been using financial behavior as a factor in disability decisions. If you spent your money fast, some examiners treated that as a sign you were capable of work. If you saved it, they sometimes suggested you were not in genuine financial need. The Fourth Circuit found this reasoning flawed: how you spend or save money tells nothing about whether you can work, and the SSA had no legal basis to make it part of the disability test.

The decision applies directly to cases in the Fourth Circuit, which covers Maryland, North Carolina, South Carolina, Virginia, and West Virginia. Other federal courts have not yet ruled the same way, so the impact varies by region. However, the SSA has indicated it will follow the principle nationally, meaning examiners across the country should no longer use spending habits as evidence for or against disability.

Key Takeaways

  • The SSA cannot use how quickly or slowly you spend money as evidence that you are or are not disabled.
  • The ruling applies directly in Maryland, North Carolina, South Carolina, Virginia, and West Virginia, but the SSA has signaled it will follow the principle nationwide.
  • If your disability claim was denied partly because of how you managed money, you may have grounds to request reconsideration or appeal.
  • The case does not change the basic test for disability — you still must show you cannot work due to a medical condition lasting at least 12 months.

How the SSA had been using financial behavior

Before the Hultz ruling, some SSA examiners included a person's spending and saving habits in their disability assessment. The logic was indirect: if you had money and spent it freely, you must be capable of managing your affairs and therefore capable of work. If you saved aggressively, you were supposedly not in genuine financial hardship. Neither conclusion followed from the facts, but the practice was common enough that it appeared in case files and hearing decisions.

This approach created a catch-22 for applicants. Spend your savings and you looked irresponsible; keep your savings and you looked able-bodied. The SSA had no written rule requiring examiners to consider financial behavior, but it happened often enough that disability advocates flagged it as a pattern. Crystal Hultz's case became the vehicle for a federal court to say the practice was legally wrong.

What the court actually decided

The Fourth Circuit's decision rested on a straightforward point: the Social Security Act defines disability based on medical capacity to work, not on financial management skills or spending choices. The statute requires that you have a "severe impairment" that prevents you from doing "substantial gainful activity" for at least 12 months. Nothing in that definition includes how you handle money.

The court also noted that financial behavior is too unreliable and too personal to serve as evidence of work capacity. Two people with identical medical conditions might spend money very differently based on personality, culture, family circumstances, or prior experience. Using spending as a proxy for disability would mean the same medical condition could lead to different outcomes depending on how the applicant happened to manage their bank account — an arbitrary result the law does not permit.

The ruling does not say the SSA cannot ask about your finances at all. The agency still needs to know your income and resources to determine whether you meet the financial limits for benefits. But that financial information goes to the question of need, not to the question of whether you are disabled.

Who the ruling helps and when it applies

The Hultz decision directly affects people in the Fourth Circuit whose disability claims were denied or whose benefits were reduced partly because of how they spent or saved money. If your case file includes language suggesting the examiner doubted your disability because of your financial behavior, you may have grounds to reopen your case.

The ruling also protects people currently in the disability process in those five states. Examiners should no longer factor spending habits into their decisions. If you are applying for Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) in Maryland, North Carolina, South Carolina, Virginia, or West Virginia, the examiner cannot use your financial choices as evidence for or against your disability claim.

Outside the Fourth Circuit, the SSA has stated it will follow the Hultz principle, but no other federal appeals court has yet issued a binding ruling. This means the protection is less certain in other regions, though the trend is moving in that direction. If you live outside the Fourth Circuit and believe your claim was affected by financial-behavior reasoning, you can still raise the issue on appeal, but you will be citing SSA guidance rather than a court order.

How to challenge a decision based on financial behavior

If your disability claim was denied and you believe financial behavior played a role, start by reviewing your case file. You can request your complete file from the SSA by contacting your local Social Security office or by using the SSA's online portal. Look for language in the examiner's decision or the Administrative Law Judge's (ALJ) hearing decision that references how you spent money, managed savings, or handled your finances as evidence of your work capacity.

If you find such language, you have several options depending on where your case stands. If you were denied and did not appeal, you can file a new application or request reconsideration. If you already received a hearing decision, you can file an appeal to the Appeals Council, the next level within the SSA system. In your appeal, cite the Hultz ruling and explain that the decision relied on financial behavior that the court has now found irrelevant to disability.

If you are in the Fourth Circuit, mention the Hultz case by name and cite it as binding authority. If you are outside that circuit, you can still cite it as persuasive authority and note that the SSA has adopted the principle nationally. A disability advocate or attorney can help you frame the argument and gather evidence to support your appeal. Many disability attorneys work on contingency, meaning they take a percentage of back pay if you win, rather than charging upfront fees.

What the ruling does not change

The Hultz decision removes one factor from disability decisions, but it does not lower the bar for proving you are disabled. You still must show that you have a medical condition — documented by medical records, test results, or clinical observations — that prevents you from working. The SSA still uses the same five-step process to evaluate claims, and you still must meet the same medical standards.

The ruling also does not affect the financial limits for SSI. If you receive Supplemental Security Income, the SSA still counts your income and resources to determine your monthly benefit amount. What changed is that your spending habits cannot be used as a reason to deny or reduce your benefits on the grounds that you are not truly disabled.

Additionally, the ruling applies only to disability decisions. It does not affect retirement benefits, survivor benefits, or other Social Security programs. And it does not create a new right to reopen old cases indefinitely — there are time limits on how far back you can appeal, typically one year from the date of a final decision, though exceptions exist for certain circumstances.

Frequently Asked Questions

Can I reopen my case if I was denied years ago because of how I spent money?

It depends on how long ago you were denied. The SSA generally allows you to reopen a case within one year of a final decision. If more than a year has passed, you would need to file a new application rather than appeal the old one. However, if you can show that the prior decision was based on an error of law — such as the now-prohibited use of financial behavior — you may have grounds to reopen even after one year. A disability attorney can review your specific timeline and circumstances.

Does the Hultz ruling mean I will automatically win my appeal?

No. The ruling removes financial behavior as a factor, but your case must still meet the medical definition of disability. If your claim was denied for other reasons — such as insufficient medical evidence or work capacity in a particular job — those issues remain. The Hultz decision helps only if financial behavior was actually part of the reason for the denial.

I live outside the Fourth Circuit. Does this ruling apply to me?

The ruling is binding only in the Fourth Circuit (Maryland, North Carolina, South Carolina, Virginia, West Virginia). However, the SSA has indicated it will follow the principle nationwide. If you are outside the Fourth Circuit and your case involved financial-behavior reasoning, you can cite Hultz as persuasive authority in an appeal, along with the SSA's own guidance adopting the principle.

What counts as "financial behavior" that the SSA cannot use?

Examples include how quickly you spend savings, whether you hold money in reserve, how you budget, whether you make large purchases, or whether you manage debt. Essentially, any observation about your personal spending or saving patterns cannot be used as evidence for or against your disability. The SSA can still ask about your income and resources for benefit calculation purposes.

Should I hire an attorney to appeal based on Hultz?

You are not required to, but an attorney or accredited representative can strengthen your appeal by framing the legal argument clearly and gathering supporting evidence. Many disability attorneys charge only if you win, taking a percentage of back pay owed. You can find accredited representatives through the SSA's website or through disability advocacy organizations in your state.