While programs such as Medicaid and SSI (Supplemental Security Income) enable millions of people with disabilities to live independently, such programs have traditionally prevented recipients from establishing savings accounts. Any amount over $2,000 in excess cash could mean the end of SSI or Medicaid benefits.
When the Achieving Better Life Experience (ABLE) Act was passed in 2014, people with disabilities could, for the first time, build savings without jeopardizing other benefits. Account holders can contribute up to $15,000 per year to an ABLE account, pay no taxes on the money, lose no benefits and, best of all, use the money whenever needed for purposes identified as related to disability. There is no penalty for withdrawing money from an ABLE account to be spent on housing, food, medical expenses, transportation, technology, or any other need associated with the account holder’s disability.
A growing number of states (39 of 50 at this writing, with California scheduled to launch as the 40th state on December 11) have established ABLE account programs. Many states allow qualified residents from anywhere in the United States to participate. Ohio and Virginia, for example, invite participants from any state, while Florida’s program is open to residents of that state only. [...]