Understanding ABLE Accounts: A Powerful Tool for Individuals with Disabilities
When it comes to protecting the financial well-being of individuals receiving disability benefits, it’s important to know about every option available. One powerful but often overlooked tool is the ABLE account. At Pettis Webber Pacific, we believe in sharing vital estate planning and elder law insights that may not be widely known but can make a big impact for families and individuals navigating disability benefits.
What Is an ABLE Account?
ABLE stands for Achieving a Better Life Experience. Enacted in 2014, the ABLE Act created a special type of savings account designed specifically for individuals with disabilities. These accounts allow beneficiaries to save money for qualified expenses without jeopardizing their eligibility for means-tested benefits like Supplemental Security Income (SSI) and Medicaid.
Why ABLE Accounts Matter
Many individuals receiving disability benefits face strict financial limits, such as the $2,000 asset cap for SSI eligibility. This limitation often makes it difficult to save for essential or future needs like transportation, housing, or education. ABLE accounts help solve this problem by offering a way to build a financial cushion without triggering benefit disqualification.
Key Features of ABLE Accounts
- Eligibility: The individual’s disability must have started before age 26 (expanding to age 46 in 2026). They must also be receiving SSI or SSDI, or have a physician-certified disability.
- Annual Contribution Limit: Up to $19,000 in 2025 from all sources. Additional contributions may be allowed for working individuals.
- Total Account Limit: Once the account exceeds $100,000, SSI payments may be suspended, though Medicaid eligibility remains unaffected.
- One Account Rule: Each eligible individual can have only one ABLE account.
- State Recovery: Funds remaining in the account after the beneficiary’s death may be subject to Medicaid payback, depending on state rules.
How to Open an ABLE Account
Residents of Washington State can explore the Washington State ABLE Savings Plan at www.washingtonstateable.com. For those outside Washington, other states offer similar programs, and the ABLE for ALL Savings Plan is available nationwide.
ABLE Accounts and Estate Planning
Incorporating an ABLE account into your estate plan is a strategic way to provide financial support to a loved one with a disability. These accounts offer a degree of independence and security while preserving essential public benefits. They can also be coordinated with special needs trusts and other planning tools for a more comprehensive approach.
Ready to Learn More?
If you or someone you care about is navigating disability benefits, an ABLE account could be a life-changing resource. At Pettis Webber Pacific, we’re here to help you understand your options and craft a plan that safeguards your future and your loved ones.
Reach out today to schedule a consultation. Let’s make sure you have every tool available to build a stable, secure future.
