Disabled Americans generally need more than what the government provides to cover their expenses every month. Until recently, they couldn’t save any money or plan for the future. Accumulating more than $2,000 — once intended to cover the burial expenses of the disabled person — meant losing critical benefits such as access to support services, supplemental Social Security or Medicaid.
Enter ABLE accounts, which were signed into law in 2014 under the same tax code as 529 college savings plans. Short for Achieving a Better Life Experience, ABLE accounts allowed people with disabilities to save $16,000 a year in 2022 without sacrificing eligibility. Employed beneficiaries could save even more, and account limits range from $235,000 to $550,000 depending on the state program.
Assets in ABLE accounts increased by 62% in 2021 and 81% the previous year. As of September, they’d accumulated $1.133 billion. The hangup? Currently, disabled people are only eligible to open an ABLE account if they become disabled before age 26, boxing out many veterans and adults who are injured in accidents.
Helping lead the bipartisan charge to raise the age of the onset of disability to 46 is Edward Mitchell, a 33-year-old independent living specialist in Tennessee.
“An accident can happen at any age,” Mitchell tells Money. He should know: At 16, Mitchell was biking to his after-school job when he was paralyzed in a hit-and-run. “In rural Tennessee, many people sustain accidents past age 26, and it affects their lives and their family’s lives,” he adds.
As one of the first people in the state to open an ABLE account (in 2016), Mitchell says he and his mother spent hours Googling combinations of the words “savings,” “disability” and “money” hoping to find ways to save money without jeopardizing his benefits.
The account has been a lifesaver for Mitchell, allowing him to stash away his earnings from the Center for Independent Living. A fitness buff, he has also used the account to buy home gym equipment, since he lives in an area without an accessible gym. His biggest purchase so far was a wheelchair-accessible van: what he calls his legs. The van cost nearly $100,000 after modifications — and an ABLE account made it possible for Mitchell to save up the funds.
Just as important, it helped ease his parents’ fears about the future, when they won’t be around to help him.
Going without an emergency plan is a luxury you can’t afford with a disability. Wheelchairs and specialized vehicles aren’t just expensive, Mitchell points out, they also carry high costs for maintenance and repair. “You always have to be aware of what might be around the corner,” he says.
Like last fall, when Mitchell held his breath every time he used his van’s wheelchair ramp after another driver ran over it. Insurance covered the cost of the $2,000 repair but didn’t pay out until November.
“If someone doesn’t have a family member with a disability, they don’t see the extra costs,” he says, “of wheelchairs, specialized gloves, of living with a disability.”
For Mitchell — a former national ambassador for the ABLE National Resource Center who spoke before a House committee in 2018 about life with a disability — ABLE is a financial lifeline. It’s one he wants others to be able to access, too, regardless of the specific date they become disabled.
“Having a disability is already hard enough,” Mitchell says.