NEW YORK — Paul Safarik, a 32-year-old resident of Lincoln, Nebraska, has spent over a decade in the food service sector. His jobs have included delivery for establishments like Raising Cane’s and stocking shelves at grocery chains such as Trader Joe’s. Recently, he purchased a treadmill to maintain his fitness during inclement weather and contributed to his dental braces. His ability to make these purchases is notably linked to a special savings program known as an ABLE account, designed for individuals with disabilities.
The ABLE account enables beneficiaries to accumulate savings beyond the $2,000 asset cap that usually accompanies government benefits like Supplemental Security Income (SSI) and Medicaid. Without this financial avenue, Safarik might jeopardize his governmental assistance by having savings over the designated limit. “Thanks to the ABLE account, we don’t need to stress as much,” said Deb Safarik, his mother, who is 71 and shares a home with Paul. “It’s wonderful that he can work and save without fearing repercussions.”
Introduced under the Achieving a Better Life Experience (ABLE) Act of 2014, these accounts have been operational since 2016 for individuals diagnosed with disabilities before turning 26. Starting next year, the eligibility age will extend to those identified before age 46, allowing approximately 6 million additional people, including 1 million veterans, access to these accounts, according to Indiana’s State Treasurer Daniel Elliott. Currently, around 8 million individuals qualify for ABLE accounts nationwide.
Elliott highlighted how restrictive the previous asset limit of $2,000 was for many families. He noted that such a limitation left many unable to save for the future effectively. Now, average balances in ABLE accounts range between $11,000 and $12,000. ABLE accounts allow totals to reach $100,000 without affecting federal benefits like SSI, with state account limits varying from about $300,000 to above $500,000. State treasurers manage these accounts, most of which can be conveniently established online, with some allowing paper applications as well.
Contributions to an ABLE account can come from various sources—including the account holder, family, friends, nonprofits, and employers—up to a maximum of $19,000 annually by 2025. If the account holder is employed and not participating in a workplace retirement program, they can additionally contribute an amount equal to their annual gross income which can range up to approximately $15,560 to $18,810, depending on the state.
There are tax benefits tied to these accounts as well. Investment gains within the ABLE accounts are not taxed as long as funds are used for qualified disability expenses, which can include medical treatment, education, job training, and more. Account owners have a variety of investment choices or can opt to save without further investing.
Elliott pointed out that the primary hurdle remains spreading awareness about ABLE accounts, particularly through the National Association of State Treasurers (NAST), where he serves as secretary treasurer. “Many families still believe that saving money could jeopardize benefits for individuals with disabilities,” he remarked. “It’s crucial that we inform them that saving is indeed possible now, enabling them to consider future investments like home purchases.”
Despite the vast number of individuals who qualify for ABLE accounts, NAST data showed only 186,641 accounts were active by the close of 2024. The change in the eligibility age is expected to broaden access for individuals whose disabilities were caused by incidents in adulthood or developed later in life, such as post-COVID complications.
Andrew Warren, a senior associate for policy and research at the Financial Health Network, noted that most disabled individuals lack awareness of these account options. “Data indicates that less than 1% of those eligible utilize ABLE accounts,” Warren commented. “Asset limits present significant barriers to reaching financial stability, and there is a noticeable gap in knowledge between caseworkers and the makers of ABLE accounts.”
To locate eligibility for an ABLE account, individuals can explore two online resources: ABLE Today and the ABLE National Resource Center, which provide guidance for determining qualification. Currently, ABLE accounts are categorized for:
— Individuals whose disabilities began prior to age 26, and
— Those with disabilities that are either terminal or long-term (lasting more than 12 months) and lead to significant functional limitations.
A qualifying individual must also meet one of the following requirements:
— Being eligible for Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI), or
— Being diagnosed with a disability by a medical professional.
The age threshold for eligibility will expand to 46 by 2026.
For individuals anticipating qualification next year, it’s wise to begin familiarizing themselves with the process of establishing an ABLE account. This way, they can promptly add funds starting January 2026. Friends, family, and organizations can also start setting aside money intended for contribution to the accounts in the individual’s name as of January 1.
