As I’m sure most of you know by now, I have a soft spot for
disabled individuals. I have mentioned this in at least two of my previous
posts so I apologize if I’m starting to sound like a broken record. However, if
you give me just a little bit more of your time I promise it’ll be quick and
painless, and you may even learn something.
The topic of this post is going to be the creation of the
Achieving a Better Life Experience (ABLE) Act, and the benefits that it will
bring to the developmentally disabled community. This Act is truly something to
be celebrated, as it will ease some of the financial strains that many disabled
people and their families undergo.
WHAT:
The ABLE Act was made an official law on December 19, 2014.
The law allows disabled citizens to open a tax-free savings account, which
allows them to save money for “qualified disability expenses.”
Some of these expenses include:
- Education
- Housing
- Transportation
- Assistive technology
- Personal support services
- Healthcare
WHY:
A question you might be asking yourself is, “What is the
need for these accounts?” I know first hand that many families with disabled
relatives rely heavily on public benefits due to the financial weight of these
expenses. However, in order for one to be eligible for public benefits (SSI, Medicaid) they must first be rendered poor! (I may sound like I am over
reacting, but I assure you, I am not.)
One of the major drawbacks of these benefits is that the
individual receiving the benefits cannot accrue more than $2,000 in savings,
retirement funds, or any other form of revenue. Let’s take a minute to think
about that…
These disabled people who, more often than not are not able
to provide for themselves, are denied basic rights if they receive or make more
than $2,000 at any time. You don’t have to be a bleeding heart to see the issue
with that…
WHO:
There aren’t many limitations to those who can apply for an
ABLE account. The only regulation is that the individual applying for the
account must have had their disability diagnosed before the age of 26. The
individual may or may not receive public benefits; it does not affect their
eligibility.
Parents with developmentally disabled children are also able
to open an account for their children, as long as the same prerequisites are
met.
Where/When:
As of December 2015, no state is offering ABLE accounts as
many of them are still in the process of developing a program. Some states may
have their programs running this year, but most are anticipated for 2017.
Individuals or their families will be able to apply for an
account online.
Other
Options:
There are other courses of action that a disabled person or
his or her family may take in order to secure their finances. A Special Needs Trust (SNT) would be another option for people with special needs. However, an
ABLE account is much more cost effective to establish, and the beneficiary of
the account has more control over his or her finances than that of a SNT.
Emotional
Stability:
The information that I have just laid out should be enough
to convince you that the ABLE Act will have a positive impact on the disabled
community. However, if the financial benefits are not enough to sway your
opinion, then think about the weight that will be lifted off so many people’s
shoulders when they know that they can financially prepare themselves, or their
loved ones, for the future.
I saw an example of this when one of my clients came into
work one day and told me about the passing of the ABLE Act. I had never heard
of the ABLE Act before, and asked him to fill me in. He proceeded to tell me
most of what I just told you. The difference, however, was the excitement on
his face when he told me what the passing of this law meant to him. I couldn’t
possibly imagine a better example of why the ABLE Act is a monumental
achievement.
