Children with disabilities and trajectories of parents' unsecured debt across the life course

Abstract

Prior research shows that having a child with a disability is economically burdensome for parents but we know little about whether this burden extends to unsecured debt. In this study, we examine the link between having a child with a disability that manifests between birth and age 4 and subsequent trajectories in unsecured household debt. We have three key findings. First, we find that having a child with an early-life disabling health condition is associated with a substantial increase in indebtedness in the years immediately following the child's birth, and that this association persists net of a range of potential confounders. Second, we find that parents do not quickly repay this debt, such that parents of a child with a disabling health condition have different trajectories of unsecured debt across the life course than do parents of children without a disabling health condition. Third, we find that the association between early-life child disability and debt is stronger for more severe conditions, such as those that require ongoing medical treatment. The results of this study are informative for understanding an important aspect of economic functioning—indebtedness—for parents of children with disabilities, as well as the causes and correlates of rising unsecured debt in the U.S.