By: Alma Rojas, Senior Financial Counselor
This month, NYLAG’s Financial Empowerment and Advocacy Unit is celebrating the 10th anniversary of ABLE Accounts!
The Stephen Beck Jr. Achieving a Better Life Experience (ABLE) Act was established on December 19th, 2014, allowing states to develop and maintain tax-advantaged ABLE Accounts, which help people with disabilities save and/or invest without the risk of losing eligibility for resource-limited government benefit programs.
For example, in NY, an individual can have up to $100,000 in an ABLE account and still potentially maintain their eligibility for SSI, Medicaid, HUD housing programs, and other public benefits. Additionally, money saved in an ABLE account does not count as an asset on the FAFSA.
ABLE account funds can be used to pay for Qualified Disabilities Expenses, which include, but are not limited to: education, health care expenses, housing, transportation, assistive technology, employment training and support, funeral and burial costs, basic living expenses and more!
Tip: For more info on Qualified Disability Expenses, check out the ABLE National Resource Center’s FAQ
An ABLE account is a great resource and tool for people with disabilities to achieve their financial goals, meet their essential needs, and achieve financial well-being.
If you are interested in opening an ABLE Account, here are some of our general tips:
1. Determine your eligibility.
- An ABLE account can be opened at any age, and individuals do not have to be currently receiving disability benefits. However, current eligibility is limited to individuals with disabilities, whose onset of disability was before 26 years of age.
- Tip: In 2026, the onset age of disability will be raised to 46 years of age. So, if you are not eligible at this time, you might be eligible in the future.
- Tip: Parents can open an ABLE account on behalf of their minor child with disabilities.
- An ABLE account can be opened at any age, and individuals do not have to be currently receiving disability benefits. However, current eligibility is limited to individuals with disabilities, whose onset of disability was before 26 years of age.
2. Determine if you need to provide “proof of disability.”
- If you are currently receiving SSI or SSDI, you do not need to provide proof of disability.
- However, if you are not receiving SSI or SSDI, but you meet Social Security’s definition of disability, you can have a doctor complete a letter of disability certification.
3. Decide what type of ABLE account(s) you want to open and the frequency of your contributions.
- Individuals can contribute up to $18,000 annually in 2024 (and potentially more, if the account is used by a working individual to save for retirement.)
- In NY, ABLE FDIC-insured checking accounts can be opened with a minimum of $25.
- Tip: You can waive the $2 monthly checking account fee by maintaining a minimum daily balance of $250 or by enrolling in electronic statements.
- The NY ABLE account also offers a Savings Option and 4 different investment portfolio options for folks with different risk tolerances.
- Tip: the investment option is great for long-term financial goals.
- Tip: ABLE account owners, who are working and saving for retirement, and who contribute to an ABLE account may be eligible to receive a federal tax credit, called the Saver’s Credit, of up to $2,000.
4. Decide if you want others to contribute to your ABLE account.
- In NY, friends and family can contribute a NY ABLE account via Ugift.
Additional resources:
- ABLE NRC – for FAQs, resources, and webinars on how to manage and maximize the benefits your ABLE Account.
- NY ABLE Account
- SSA Spotlight on ABLE Account
Still have questions? NYLAG Financial Counselors help you create a plan to secure a financially stable future.
- If you are currently working with a NYLAG financial counselor, reach out to them now to discuss your options.
- Connect with a NYLAG financial counselor.
