ABLE accounts allow Americans with disabilities to save and invest. Here’s how.

Paul Safarik, a 32-year-old resident of Lincoln, Nebraska, has been working in the food industry since he was 21. Starting out with delivery jobs for quick-service restaurants like Raising Cane’s and stocking groceries at stores like Trader Joe’s, Safarik has been able to earn a living despite having Down syndrome. Recently, he made some significant purchases with his earnings, including a treadmill to stay active during bad weather and braces for his teeth.

One of the key factors that allowed Safarik to make these purchases without risking his government benefits is an ABLE account. This little-known savings account is designed for individuals with disabilities, allowing them to save money beyond the $2,000 asset limit usually associated with benefits like Supplemental Security Income and Medicaid. Without the ABLE account, Safarik could have faced the possibility of losing his government assistance if he exceeded the asset limit.

Named after the Achieving a Better Life Experience Act of 2014, ABLE accounts have been available since 2016 to individuals diagnosed with a disability before the age of 26. Starting next year, they will be accessible to those identified before the age of 46, expanding access to an additional 6 million people, including 1 million veterans. Currently, an estimated 8 million people nationwide qualify for ABLE accounts.

One of the main benefits of ABLE accounts is that they allow individuals to save up to $100,000 without affecting Supplemental Security Income. Lifetime balance limits for state ABLE accounts vary but can range from around $300,000 to over $500,000. Contributions to ABLE accounts can be made by anyone, including the account owner, friends, family, organizations, nonprofits, and employers, up to $19,000 per year in 2025. Additional contributions can be made based on the account owner’s gross income if they are not already contributing to a workplace retirement plan.

Moreover, ABLE accounts offer tax advantages, with investment earnings remaining untaxed as long as the funds are used for qualified disability expenses such as medical treatment, education, tutoring, and job training. Account holders have the flexibility to choose from a variety of investment options or simply save their money without further investment.

Despite the benefits of ABLE accounts, awareness remains a significant challenge. According to the National Association of State Treasurers, only a small percentage of eligible individuals have opened ABLE accounts. Raising awareness about these accounts and educating individuals about their eligibility and benefits is crucial to increasing their utilization.

In conclusion, ABLE accounts provide a valuable financial tool for individuals with disabilities to save for their future without jeopardizing their government benefits. With increased awareness and accessibility, more individuals can benefit from the financial security and independence that ABLE accounts offer.