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Saving Money Through an ABLE Account
Last week I brought up the issue I’m dealing with as an Supplemental Security Income (SSI) recipient: not being allowed to retain assets over $2,000. This makes it impossible for me to save money so that I might eventually stop receiving assistance.
However, over the weekend I learned about ABLE Accounts, which are tax-advantaged savings accounts for individuals with disabilities and their families. The Achieving a Better Life Experience Act of 2014 (aka the ABLE Act) enables eligible individuals to make annual contributions up to $15,000 to an untaxed account to invest and save for qualified disability expenses. It’s similar to a 401(k) account, but there’s no penalty for withdrawing the money early — in fact, you can immediately use the funds for qualified expenses, which include housing.
You can have up to $100,000 in your ABLE account and keep getting SSI benefits. If you go over $100,000, SSI benefits will stop, but if your ABLE account drops back below $100,000 they will start up again without reapplying. I’m looking into this option for my own savings. I wonder if anyone else has considered this or has started using an ABLE Account? Any drawbacks you anticipate?
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