ABLE accounts are a powerful tool for people with disabilities to save money without risking benefits. This comprehensive guide covers everything you need to know.
In this article, we'll cover:
- ABLE account basics
- Eligibility requirements
- What you can spend on
- How to open and manage
1. ABLE Account Basics
What is an ABLE account:
- Tax-advantaged savings account
- For people with disabilities
- Doesn't count toward SSI limit
- Up to $100,000 excluded
Key benefits:
- Save beyond $2,000 SSI limit
- Tax-free growth
- Tax-free withdrawals (qualified expenses)
- Keep your benefits
2026 contribution limits:
- Annual limit: $19,000 (GIFT tax exclusion)
- ABLE to Work: Additional $15,300 if working
- Lifetime varies by state
- $100,000 excluded from SSI
How it works:
- Open account in any state
- Deposit up to annual limit
- Spend on qualified expenses
- Benefits stay intact
Important: While you can save up to your state's lifetime limit, only the first $100,000 is excluded from SSI resource calculations.
2. Eligibility Requirements
Age requirement:
- Disability began before age 26
- Not when you apply—when disability started
- Can open at any age if this is met
- Must be able to document
Disability qualification:
- Receiving SSI or SSDI, OR
- Meet SSA disability criteria, OR
- Blind under SSA definition
- Self-certification option
One account per person:
- Can only have one ABLE account
- Can change states
- Must close old before opening new
- One beneficiary per account
Residency:
- Can open in any state
- Don't need to live there
- Compare state programs
- Some have better features
3. What You Can Spend On
Qualified disability expenses (QDEs):
Education:
- Tuition and fees
- Books and supplies
- Tutoring
- Special education services
Housing:
- Rent or mortgage
- Utilities
- Property taxes
- Home modifications
Transportation:
- Car purchase/payments
- Maintenance and repairs
- Public transit costs
- Ride services
Health and wellness:
- Medical expenses
- Dental and vision
- Mental health services
- Gym membership
Assistive technology:
- Wheelchairs and mobility devices
- Communication devices
- Computer equipment
- Software and apps
Employment support:
- Job training
- Work-related transportation
- Job coaching
- Career counseling
Daily living:
- Personal care attendants
- Groceries
- Household goods
- Clothing
What to avoid:
- Gambling
- Illegal activities
- Expenses unrelated to disability
- Non-qualified withdrawals (taxed + penalty)
4. How to Open and Manage
Choosing a program:
- Compare state programs
- Look at fees
- Investment options
- Debit card availability
Opening process:
- Choose state program
- Gather eligibility documents
- Complete application
- Fund your account
- Start using
Managing your account:
- Track contributions (annual limit)
- Keep receipts for expenses
- Monitor balance
- Review investments
Tips for success:
- Set up automatic contributions
- Use for recurring expenses
- Keep records
- Understand your state's features
ABLE Account Strategies
Building savings:
- Regular small deposits
- Direct deposit from work
- Save windfalls
- Build emergency fund
Using strategically:
- Pay regular bills
- Save for large purchases
- Build housing fund
- Create safety net
Combining with other tools:
- Purple for daily spending
- ABLE for savings
- Trust for large assets
- Each serves a purpose
How Purple Helps
Purple works seamlessly with ABLE accounts:
- Track daily spending separately
- See full financial picture
- Easy transfers to ABLE
- Stay organized
- Manage benefits confidently