If you're planning for the financial future of someone with a disability, you may be wondering whether you need to choose between an ABLE account and a Special Needs Trust (SNT).
The good news? You don't have to choose. You can have both—and in many cases, using them together provides the best protection.
In this article, we'll cover:
- How ABLE accounts and Special Needs Trusts differ
- Why having both can be beneficial
- How contributions and spending rules compare
- When to use each account type
1. How ABLE Accounts and Special Needs Trusts Differ
Both ABLE accounts and Special Needs Trusts help people with disabilities save money without losing SSI, Medicaid, or other means-tested benefits. But they work differently.
ABLE Accounts:
- Owned and controlled by the beneficiary (in most cases)
- Annual contribution limit of $18,000 (2026), with additional limits for working beneficiaries
- Total account balance limit varies by state (typically $100,000 before affecting SSI)
- Easy to open and manage online
- Funds can be spent on qualified disability expenses (QDEs)
Special Needs Trusts:
- Managed by a trustee (not the beneficiary)
- No contribution limits
- No balance limits
- Requires legal setup and ongoing administration
- Can cover a broader range of expenses
2. Why Having Both Can Be Beneficial
Using an ABLE account and an SNT together gives you the best of both worlds:
- Flexibility: ABLE accounts let the beneficiary make day-to-day purchases independently using a debit card
- Capacity: SNTs can hold larger amounts, like inheritance or legal settlements
- Control: The trustee manages the SNT while the beneficiary controls ABLE spending
- Protection: Both protect eligibility for government benefits
Many families fund the ABLE account from the SNT on a regular basis—giving the beneficiary spending independence while keeping the bulk of assets protected.
3. How Contributions and Spending Rules Compare
| Feature | ABLE Account | Special Needs Trust | |---------|--------------|---------------------| | Annual contribution limit | $18,000 (2026) | None | | Balance limit for SSI | $100,000 | None | | Who controls spending | Beneficiary | Trustee | | Setup cost | Free or low-cost | $2,000–$5,000+ | | Ongoing admin | Minimal | Requires trustee |
Important: ABLE accounts can only be used for Qualified Disability Expenses (QDEs), which include housing, education, transportation, healthcare, and basic living expenses. SNTs can often cover a wider range of supplemental needs.
4. When to Use Each Account Type
Use your ABLE account for:
- Everyday spending (groceries, clothing, personal items)
- Recurring bills (phone, internet, transportation)
- Small purchases that don't require trustee approval
- Building a modest emergency fund
Use your SNT for:
- Large expenses (vehicles, home modifications, specialized equipment)
- Long-term savings and investments
- Funding the ABLE account periodically
- Expenses that exceed ABLE limits
This combination keeps the beneficiary independent while ensuring larger assets remain protected and professionally managed.
5. How Purple Helps You Manage ABLE Funds
Purple makes it easy to manage your ABLE account alongside other financial tools. With Purple, you can:
- Open an ABLE-compatible savings account
- Get a debit card for everyday qualified expenses
- Track spending by category to ensure QDE compliance
- Set savings goals for specific disability-related needs
- View your balance and transactions in real time
- Export records for tax reporting or trust documentation
Whether you're managing your own ABLE account or helping a family member, Purple gives you the tools to stay organized and compliant.