Achieving a Better Life Experience (ABLE)

When we think about investing for the future, retirement often comes to mind. While retirement planning is important, there are other valuable investment accounts that many people don't know about. One such account is the ABLE account.

You've probably heard about Roth IRAs on social media – they're known for tax-free growth, a great way to save for retirement. ABLE accounts also offer tax-free growth when used correctly, but they serve a different purpose. ABLE accounts were created in 2014 specifically to help individuals with disabilities and those who care for them.

Here are some key features of ABLE accounts that people with disabilities and their families should know:

• Eligibility: The disability must have occurred before the individual turned 26.

• Account Management: Individuals 18 or older can open and manage their own ABLE account.

• Contribution Limits: You can save up to $19,000 per year (for 2025).

• SSI Benefits: Up to $100,000 in an ABLE account won't affect Supplemental Security Income (SSI) benefits.

• Contributions: Anyone can contribute to the eligible individual's account.

• Tax-Free Withdrawals: Withdrawals, including earnings, are federal income tax-free if used for qualified disability expenses.

• Investment Options: Funds can be invested, which means they may grow or lose value.

  
  

What are qualified disability expenses?

These are expenses that allow the individual to maintain or improve their health, independence, or quality of life. Some examples include:

• Education

• Housing

• Transportation

• Health care

• Basic living expenses

  
  

For more detailed information, please visit these resources:

• Social Security Administration (SSA)

• Internal Revenue Service (IRS)

• Texas ABLE Accounts

  
  

If you or someone you care for has a disability that began before age 26, an ABLE account could be a very helpful financial tool.