ABLE accounts
With disabilities, the income and asset restrictions for SSI and Medicaid, it's usually impossible to save up for anything! I'm sure I'll discuss how outdated the caps are in a future post, but for now, I want to discuss something that many people - including those who qualify - don't know about: ABLE accounts.
Achieving a Better Life Experience (ABLE) accounts are tax free savings accounts for some disabled people (adults and some children as well). They aim to ease some of the financial impact related to disabilities, namely by allowing them to have a savings account without the fear of losing benefits. The accounts have certain restrictions, which I'll get into below, but could make a massive difference in your quality of life.
Stephen Beck Jr., who successfully advocated for the ABLE account creation, with his family
Who's eligible?
In order to be eligible, one must be (all before the age of 26):
An SSI recipient who started receiving benefits
In SSI suspense due to excess income or assets
Receiving Disability Insurance Benefits (DIB)
Receiving Childhood Disability Benefits (CDB)
Receiving Widow's Benefits or Widows with Disabilities Benefits (DWB)
Subject of a disability certification
In general, the accounts are geared towards the younger population of disabled people - people who probably didn't have the opportunity to have a career before becoming disabled or were disabled since birth.
Building the Account
Anyone can contribute to the account either a one time gift or regular recurring amounts. The amount must be limited to a certain amount yearly, which varies by state. As of September 2023, the maximum yearly gift amount for the continental US is $12,880, $16,090 in Alaska, and $14,820 for Hawai'i.
Once the account is established, you can set it up as a savings account only or designate a certain percentage to invest in stocks. I'm not very familiar with stocks, but I recall the stock options were for a low, medium, and high risk stock option.
Restrictions
The accounts are limited in what you can use the money for, however they still cover the vast amount of purposes. The accounts can be used for Qualified Disability Expenses (QDE), which is defined as "expenses made for the benefit of the designated beneficiary and related to their disabilities." They further define these as expenses that include (but not limited to):
Education, employment training and suppor5
Housing and transportation
Basic living expenses
Health, wellness, and prevention
Legal fees
Financial management and administrative services
Assistive technology and related services
Expenses for ABLE account oversight and management
Funeral and burial
The first $100,000 in the ABLE account is not counted as a resource but the difference is applicable to the asset restrictions for SSI and Medicaid.
Final
The ABLE account program is an amazing option for those who qualify. It's unfortunate that it's not more well known; I didn't find out about it from the SSA office, but from other disabled people online! Particularly in a world that is expensive to be disabled in, more people should know what options they have!
Update
Starting in 2026, the age restriction for ABLE accounts will be raised to 46.