Imagine waking up one day to find your life completely altered. A sudden injury, a diagnosis, or an unexpected event changes everything, and suddenly, you’re navigating a world that feels entirely new. For millions of people with disabilities, this is their reality—and managing finances while preserving access to critical government benefits can feel like walking a tightrope. That’s where ABLE accounts come in, offering a lifeline for individuals with disabilities to save and invest without losing their safety net. With recent legislative changes, including a significant bill signed in 2025, these accounts are becoming more powerful than ever.
A Game-Changer for Disability Savings
For those unfamiliar, Achieving a Better Life Experience (ABLE) accounts are tax-advantaged savings tools designed specifically for individuals with disabilities. They allow people to save money without jeopardizing eligibility for programs like Medicaid, Social Security Disability Insurance (SSDI), or Supplemental Security Income (SSI). I’ve always found it remarkable how these accounts strike a balance between financial independence and maintaining essential benefits. But what’s new? Starting in 2026, the rules are expanding, and a recent legislative package—often referred to as a “landmark bill”—is making these accounts even more attractive.
What Are ABLE Accounts, Exactly?
Think of ABLE accounts as a cousin to the 529 college savings plans, but tailored for disability-related expenses. Established under a 2014 federal law, these accounts are managed by states, with 46 states and Washington, D.C., currently offering them. What’s great is that many plans, like Virginia’s ABLEnow, are open to residents nationwide. The beauty of these accounts lies in their flexibility—savings grow tax-free, and withdrawals for qualified disability expenses (like housing, healthcare, or transportation) are exempt from federal and state income taxes.
ABLE accounts give people with disabilities the chance to save and dream big without losing their benefits.
– Financial planning expert
Here’s the kicker: up to $100,000 in an ABLE account doesn’t count toward the SSI resource limit, meaning you can save without risking your benefits. For other programs like Medicaid or SSDI, the entire balance is exempt from resource calculations. It’s a rare win-win in the world of personal finance.
Big Changes Coming in 2026
Starting January 1, 2026, the ABLE Age Adjustment Act will expand eligibility, and it’s a big deal. Previously, only individuals whose disability began before age 26 could open an ABLE account. Soon, that age cap will jump to 46. This change opens the door for millions more people—think veterans with service-related injuries, adults with conditions like multiple sclerosis, or those recovering from strokes. According to financial data experts, about 8 million people currently qualify, with account assets totaling $2.5 billion as of early 2025. With the new rules, that number could swell by 50%, potentially reaching 15 million eligible individuals.
Why does this matter? Because life doesn’t always follow a neat timeline. Disabilities can emerge at any age, and this expansion acknowledges that reality. I can’t help but think of someone like my friend’s uncle, who developed a neurological condition in his late 30s. Under the old rules, he wouldn’t have qualified for an ABLE account. Now, he’d have a shot at building a financial cushion.
- Wider eligibility: Expands access to those with disabilities onset before age 46.
- More savings potential: Up to 15 million people could benefit, a 50% increase.
- Inclusive for veterans: At least 1 million more veterans may qualify.
The “Landmark Bill” Boost
In early 2025, a major tax and spending package—let’s call it the “landmark bill” for simplicity—made waves by locking in several tax advantages for ABLE accounts. These changes, originally part of a 2017 tax law, are now permanent, making ABLE accounts a more robust tool for savers. For example, the annual contribution limit is tied to the gift tax exclusion, set at $19,000 per recipient in 2025 and likely to rise with inflation. If you’re a severely disabled worker not contributing to certain retirement plans, you might even be able to save more, depending on your income and state plan rules.
Another game-changer? You can now roll over funds from a 529 college savings plan into an ABLE account. Picture this: you’ve saved $150,000 for your child’s college, but they develop a disability later in life. Instead of letting those funds sit unused, you can transfer them to an ABLE account to cover therapy, adaptive equipment, or other needs. Plus, you can still add the annual $19,000 gift on top of that. It’s the kind of flexibility that makes you wonder why it took so long to implement.
This bill gives families a way to repurpose savings for a loved one’s new reality.
– Wealth management advisor
Tax Breaks and the Saver’s Credit
Here’s where things get even more interesting. Starting in 2027, low-income savers contributing to ABLE accounts may qualify for the Saver’s Credit, a tax break typically reserved for retirement savings. The credit’s contribution limit will nudge up from $2,000 to $2,100, with a maximum credit of $1,050. This might not sound like a fortune, but for someone scraping by on limited income, it’s a meaningful boost. In my view, this small tweak signals a broader shift toward recognizing disability-related savings as a priority.
| Feature | Current Rule | 2026 and Beyond |
| Age Eligibility | Disability onset before 26 | Disability onset before 46 |
| Annual Contribution | $19,000 (2025) | Adjusted for inflation |
| Saver’s Credit | Not applicable | Up to $1,050 (2027) |
| 529 Rollover | Limited | Full balance transferable |
Real-Life Impact: A Caregiver’s Perspective
Let’s talk about someone like Sarah, a caregiver for her brother, who suffered a traumatic brain injury in his 30s. His insurance doesn’t cover speech therapy, which could help him regain communication skills. Sarah’s been saving what she can, but it’s tough. An ABLE account could change that, letting her funnel money into therapies or adaptive equipment without worrying about his SSI eligibility. With the new age cap, her brother qualifies, and the ability to roll over 529 funds means she can repurpose old college savings for his care. It’s not just numbers—it’s hope.
I’ve seen families struggle to balance care costs with financial stability. ABLE accounts offer a way to plan for the future without sacrificing the present. The expanded eligibility and tax perks make it easier for caregivers like Sarah to focus on what matters most: helping their loved ones thrive.
Why ABLE Accounts Matter for Financial Independence
Financial independence isn’t just about having money—it’s about having options. For people with disabilities, ABLE accounts provide a path to save for big goals, like moving into accessible housing or pursuing specialized training. The tax-free growth and flexibility to use funds for a wide range of expenses make these accounts a powerful tool. Plus, contributions from family and friends can add up, creating a community-driven safety net.
Here’s a quick breakdown of what ABLE accounts can cover:
- Healthcare: Therapy, medical equipment, or uncovered treatments.
- Housing: Rent, utilities, or accessibility modifications.
- Transportation: Adaptive vehicles or public transit costs.
- Education and Training: Courses or programs to build skills.
- Daily Living: Personal care or assistive technology.
Challenges and Considerations
Of course, no financial tool is perfect. ABLE accounts have their quirks. For one, the contribution limits might feel restrictive for high-income families hoping to build a larger nest egg. And while the age expansion is exciting, it doesn’t help those whose disabilities begin later in life. I sometimes wonder if future reforms could push the age cap even higher—or eliminate it altogether. Still, the current changes are a massive step forward.
Another consideration? Not all states offer ABLE plans with the same features. Some have higher fees or less flexibility. If you’re exploring options, it’s worth comparing plans to find one that fits your needs. A financial advisor with experience in special needs planning can be a lifesaver here.
Looking Ahead: A Brighter Financial Future
The updates to ABLE accounts signal a growing recognition of the financial challenges faced by people with disabilities. By expanding eligibility and cementing tax benefits, lawmakers are giving millions a chance to build wealth without losing their safety net. Perhaps the most exciting part is the ripple effect—families, caregivers, and communities can rally around these accounts to support their loved ones.
If you or someone you know might qualify, now’s the time to explore ABLE accounts. Check your state’s plan, talk to a financial planner, and consider how these accounts could fit into your broader financial strategy. In a world that often feels stacked against people with disabilities, ABLE accounts are a rare bright spot—a tool that empowers without penalizing.
Financial tools like ABLE accounts remind us that everyone deserves a shot at security and independence.
– Disability advocate
As I reflect on these changes, I can’t help but feel optimistic. ABLE accounts aren’t just about money—they’re about dignity, choice, and the chance to dream a little bigger. What could you do with a financial tool like this in your corner?
