It is hard for a parent of a child with a disability to manage finances. You want to provide the best possible life for your child. You must be sure that they have access to essential resources. You do not want to sacrifice their eligibility for government benefits. An ABLE (Achieving a Better Life Experience) account used with a supplemental needs trust can help.
What is an ABLE Account?
ABLE accounts are tax-advantaged savings and investment tools for people with disabilities. ABLE accounts let eligible people save and invest funds for qualified disability expenses. Having an ABLE account does not risk access to federal benefits such as Supplemental Security Income (SSI) and Medicaid. With ABLE, families can provide their children with what they need and still get vital support services.
To have an ABLE account, a person must have a disability that began before the age of 26. This cut-off age is set to change to 46 on January 1st, 2026. This change is important. The higher age admits the lifelong challenges faced by individuals with disabilities. This will allow more people to benefit from an ABLE account.
What Can ABLE Account Funds Be Used For?
An ABLE account is flexible in the spending that is allowed. Funds within the account can be used for expenses that make life better for individuals with disabilities. Qualified expenses include:
- Housing: Paying for rent, mortgage, or home modifications that accommodate the individual’s needs.
- Education: Covering tuition, books, and other related educational costs.
- Transportation: Funding public transportation, vehicle modifications, or other travel expenses.
- Healthcare: Assisting with medical costs, therapy, or equipment that improves health and mobility.
This flexibility lets families make the best decisions for their situation and the specific needs of their children.
ABLE Accounts Give Accountholders More Control
ABLE accounts give control to the accountholders. Unlike traditional trusts or managed accounts where other people often have decision-making power, people with ABLE accounts are in charge of how to use their funds. This supports independence and also allows families to change their financial strategies when needed.
For parents of children with disabilities, financial planning is crucial for long-term security. An ABLE account can be a vital tool in such planning. An ABLE account means that your child may receive essential services and support and not lose public benefits. It allows for a balance between savings and receiving necessary assistance.
Interested in an ABLE Account? Speak to an Estate Planning Attorney
As a parent, utilizing ABLE accounts can lead to better decisions for your child’s future. A flexible financial tool designed to secure the well-being of individuals with disabilities, ABLE accounts offer peace of mind to families. ABLE accounts make it possible for families to build a brighter, more stable future for their loved ones. If you are considering setting up an ABLE account, consult with an estate planning attorney or explore state-specific programs to find the best options available to you.
