Core Insights - The ABLE accounts, established by the ABLE Act of 2014, allow individuals with disabilities to save and invest without losing eligibility for benefits like SSDI, SSI, and Medicaid [1][3] - Recent changes have expanded eligibility for ABLE accounts to 14 million Americans, up from 8 million, by raising the age limit for disability diagnosis from 26 to 46 [5][6] Summary by Sections Account Features - The average ABLE account balance at Vestwell is approximately $13,000, with some accounts exceeding $300,000 [2] - Investment options include an all-equity fund and an all-cash savings option, with the cash option being the most popular [2] - ABLE accounts allow tax-free investment growth and withdrawals for qualified expenses, which are not counted as income for means-tested benefits [7] Eligibility and Rules - To qualify for an ABLE account, individuals must have a disability or blindness lasting at least a year and diagnosed before age 46 [11] - There are no income limits for having an ABLE account, and only one account is allowed per person [12][13] - The annual contribution limit for ABLE accounts is set at $20,000, with additional contributions allowed for account holders who are employed [14] Qualified Expenses - Funds from ABLE accounts can be used for a variety of qualified disability expenses, including living costs, healthcare, education, and assistive technology [15] - Withdrawals for nonqualified expenses may incur taxes and penalties [16] Barriers and Challenges - Awareness of eligibility and account features remains low, with many potential users unsure if they qualify [10] - Some states have different features and limitations for ABLE accounts, and not all states offer these accounts [9][19] - The online-only nature of account opening can be a barrier for individuals without internet access [20] Impact and Future Outlook - The expansion of eligibility for ABLE accounts is seen as a significant advancement for financial wellness among individuals with disabilities [19] - The potential for increased financial flexibility and security through ABLE accounts is highlighted by users who have experienced financial challenges due to disabilities [23]

Core Perspective - The financial landscape for Americans with disabilities will significantly change on January 1, 2026, with the expansion of ABLE account eligibility from age 26 to 46, transforming it into a mainstream financial tool [1][2]. Group 1: Expansion of Eligibility - The ABLE Age Adjustment Act will increase the eligible population from approximately 8 million to 14 million Americans, acknowledging that many disabilities occur later in adulthood [3]. - The adjustment allows individuals with disabilities that onset before age 46 to open an ABLE account at any age, addressing the reality that long-term disabilities can develop after age 26 [5]. Group 2: Financial Implications - ABLE accounts serve as tax-advantaged savings and investment vehicles tailored for individuals with qualifying disabilities, enabling them to save without jeopardizing government benefits [4]. - Prior to ABLE accounts, individuals with disabilities were limited to $2,000 in assets, risking their eligibility for means-tested programs like SSI and Medicaid [5]. - The ability to save for future needs without tax friction is valuable across the economic spectrum, helping individuals build a better economic future [6].

Core Insights - Starting in 2023, approximately 6 million additional individuals with disabilities became eligible for ABLE accounts, expanding eligibility to those who become disabled before age 46 [1][8] - ABLE accounts allow tax-free growth and withdrawals for qualified disability expenses, including transportation, food, education, and healthcare [2][8] - Contributions to ABLE accounts are capped annually, with a limit of $20,000 for 2026, and additional contributions allowed for working individuals without access to employer retirement plans [5][8] Eligibility and Benefits - To qualify for an ABLE account, individuals must have experienced their disability before age 46, and eligibility includes those receiving SSI or disability insurance benefits [6][8] - Assets in an ABLE account up to $100,000 do not affect eligibility for Supplemental Social Security Income (SSI) or other programs like Medicaid and SNAP [4][5] - Nearly all states offer ABLE accounts, with exceptions being Idaho, North Dakota, South Dakota, and Wisconsin [7]

Core Insights - 529 education savings plans are effective for managing education costs, but concerns about oversaving exist [1] - The Secure 2.0 Act allows for the rollover of unused 529 funds to a Roth IRA, with specific rules in place to prevent misuse [2][5] Group 1: 529 Plans Overview - 529 plans are often opened at birth, creating uncertainty about future education needs [2] - Parents can change the beneficiary of a 529 plan if they have multiple children [2] Group 2: Rollover Rules - The Roth IRA receiving 529 funds must be in the name of the 529 plan beneficiary and the 529 plan must be open for at least 15 years [3] - Contributions made within the last five years cannot be converted, and the rollover counts toward the IRA annual contribution limit [3][4] Group 3: Conversion Limits - A maximum of $35,000 can be rolled over from a 529 plan to a Roth IRA during a lifetime [4] - The conversion must be made directly to a Roth IRA, and the beneficiary must have eligible earnings at the time of conversion [4] Group 4: Implications of Rollover - The rollover option alleviates concerns about oversaving for education but should not be relied upon for retirement savings [5] - The rules ensure that 529 plans are used primarily for educational purposes, maintaining the integrity of the savings plan [5] Group 5: 529 Rollovers to ABLE Accounts - Families with a child with disabilities can roll over 529 accounts into ABLE accounts, which offer tax advantages while preserving eligibility for government assistance [6] - ABLE accounts operate similarly to 529 plans, with after-tax contributions and tax-free withdrawals for qualified expenses [6]