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SSD benefits recipients may want to consider ABLE accounts

A federal law passed in 2014 established ABLE accounts, which permit those who receive Social Security disability benefits to save a maximum of $100,000 in the ABLE account while still retaining their government benefits. ABLE accounts are offered by 42 states, including Oklahoma, and the District of Columbia. However, an analysis from the National Association of State Treasurers states that fewer people than anticipated have so far opened ABLE accounts.

As of the end of 2018, only 35,000 ABLE accounts were established in the U.S. However, the state treasurers’ group reports that 450,000 ABLE accounts need to be funded by June 2010 for the government to continue offering this program as it currently stands. While the program itself is likely to remain an option for some, some state programs may have to raise their fees if more people do not open ABLE accounts.

As the program currently stands, to open an ABLE account a person must have been disabled since age 26 or before. Legislation has been proposed that would up that threshold to age 46. This would make it so that 6.1 million more disabled individuals would be eligible for an ABLE account.

However, the situation is not hopeless. According to the National Disability Institute, approximately 8 million disabled individuals throughout the U.S. are eligible for ABLE accounts, and the number of ABLE accounts being opened is on the upswing. People fear losing their SSD benefits if they earn too much and may not understand that an ABLE account will not count as earnings for the purposes of qualifying for SSD benefits. So, some people who receive disability benefits may want to determine whether opening an ABLE account is right for them, and if so, how they should proceed.

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