Assessing ABLE Accounts
With the passage of the Stephen Beck Jr. Achieving a Better Life Experience Act of 2014 (ABLE Act) individuals with disabilities may utilize tax-advantaged savings accounts, referred to as ABLE Accounts. The ABLE Account, is however, only one tool in a special needs planner’s toolbox. Due to various restrictions (such as the requirement that the individual must have been disabled prior to age 26 and funding limitations) and the Medicaid payback, these tools have limited use in special needs planning. When appropriate, the pros and cons of the various ABLE programs should be assessed before selecting which account will most benefit the individual with a disability. The ABLE National Resource Center (https://www.ablenrc.org/) is a resource designed to assist in comparing the various state ABLE programs so as to identify which program may best suit a client’s need*. Some information obtained from ABLE National Resource Center identifies some of the following important elements:
FEES
Different ABLE programs assess different fees. For instance, Virginia’s ABLENow program has no enrollment fee but there is a monthly $3.25 account service fee for all accounts with less than a $10,000 balance. Ohio’s STABLE program has a $6.75 quarterly fee for Ohio residents and a $9.75 quarterly fee for non-Ohio residents. In contrast, Attainable Savings Plan Accounts and Portfolios, which is the Massachusetts ABLE program, has no set fees, and instead imposes a Program Management fee (daily charge of .15% against Attainable Plan portfolio assets and 0.00 – 0.15% annually for Money Market portfolios) and State Sponsor Fee (.05% against Attainable Plan portfolio assets and 0.00 – 0.05% annually for Money Market portfolios), in addition to underlying Mutual Fund expenses.
CONTRIBUTION REQUIRMENTS
Some programs have minimum contribution requirements, which are usually nominal. For instance, STABLE and PA ABLE, Pennsylvania’s ABLE program, both have a $25 initial funding requirement, while Florida’s ABLE United has a $5 initial funding requirement, and others have no set minimum. There may also be account contribution minimums. PA ABLE has a $25 minimum, while STABLE sets theirs at a $1.
INSURANCE
Some programs are FDIC insured, such as ABLENow and STABLE, while others, such as Attainable Savings Plan Accounts and Portfolios, are not.
INVESTMENT OPTIONS
The various programs use different investment managers, and have different investment options. The number of different options also vary from program to program. The investment options for a single program appear to be below 10.
DEBIT CARD AVAILABILITY
Some programs offer debit card options, while others do not. Additionally, some programs, such as PA ABLE and Oregon’s ABLE for All program, charge a fee for this convenience.
OUT OF STATE ENROLLMENT
Not all programs are available to out of state residents. For example, ABLE United is not available to out of state residents.
*Disclosure Per ABLE National Resource Center: The ABLE National Resource Center does not manage or issue ABLE accounts directly. We work with state ABLE programs to ensure information contained in our tools and resources is updated regularly. We monitor these resources closely, but all information remains subject to change by individual state ABLE programs. For details about any state ABLE program, refer to the state’s plan disclosure documents.
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