The coronavirus pandemic has underscored the importance of financial stability, especially amongst the disability community, where unemployment reached a 7-year high in 2020. For the estimated 8 million eligible Americans, ABLE accounts have provided an opportunity for financial stability during a tumultuous time. Now, Congress has the chance to expand this lifechanging program to help millions of additional Americans with disabilities save – and the opportunity is more urgent than ever.
Before the ABLE Act’s passage in 2014, Americans with disabilities risked losing their federal Supplemental Security Income (SSI) benefits anytime they saved over $2,000 in their own name. The ABLE Act created tax-advantaged savings accounts for people with disabilities and their families that does not jeopardize eligibility for federal and state disability benefits. Withdrawals from ABLE accounts are tax-free, so long as the funds are used for qualified disability expenses such as housing, education, transportation, personal support services, assistive technology, and health care.
Now, 43 states and the District of Columbia have launched ABLE programs and more than $642 million has been saved in over 82,000 ABLE accounts nationwide. While this growth and investment is worth celebrating, we must also acknowledge that many Americans with disabilities remain unable to utilize ABLE accounts due to an age cutoff specified in the current legislation. Only individuals who acquire their disability before the age of 26 are eligible to open accounts. This means only about 20 percent of Americans with disabilities are ABLE-eligible.
Recognizing the success of ABLE programs and the significant gap in eligibility, Sens. Bob Casey (D-Pa.) and Jerry Moran (R-Kan.) and Reps. Tony Cárdenas (D-Calif.), Judy Chu (D-Calif.) and Cathy McMorris Rodgers (R-Wash.) recently reintroduced the bipartisan, bicameral ABLE Age Adjustment Act. This legislation would increase program eligibility by allowing people who have acquired a disability before age 46 to open ABLE accounts — a commonsense change that would expand program access to more than 6 million adults with disabilities, including 1 million veterans with disabilities.
The savings opportunities that would accompany ABLE expansion are urgently needed. Between March and August of last year, one in five workers with disabilities were laid off, compared with one in seven workers in the general population. By the end of 2020, the unemployment rate for persons with a disability had increased to a shocking 12.6 percent. The disproportionate impact of the current health and economic crisis, combined with the heightened costs of living with a disability, has put many Americans with disabilities — many of whom were already living on the financial edge — in a difficult position.
Moreover, many individuals with disabilities received or anticipate a third round of economic impact payments, totaling up to $1,400. Access to an ABLE account will ensure that this money is not mixed with other personal funds that could count towards resource limitations for certain federal benefits, while expanding access to an important savings vehicle.
As Americans with disabilities continue to grapple with the health and financial impact caused by the COVID-19 pandemic, one thing is incredibly clear — we must expand opportunities for financial stability among this population of Americans. With greater savings comes increased financial security and flexibility for the disability community. We can make this a reality by ensuring that more Americans have access to ABLE accounts through the ABLE Age Adjustment Act.
By Fiona Ma and John McMillan, opinion contributors — 04/20/21 07:30 AM EDT 31
Fiona Ma is California State Treasurer and Chair of the National Association of State Treasurers ABLE Committee. John McMillan is Alabama State Treasurer and Vice Chair of the National Association of State Treasurers ABLE Committee