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Week #4: How Do I Manage My Account?

 

Understanding How to Manage an ABLE Account

ABLE accounts are a unique savings and investment vehicle for individuals with disabilities.  They allow eligible individuals with disabilities to build assets through savings and investments in order to help them better reach their financial goals and create a more promising economic future. ABLE Accounts allow for significant amounts of money to be put into a tax advantage saving and investment account without affecting their eligibility for means tested programs such as SSI or Medicaid.

It is important to note that the funds contributed into an ABLE account can be invested in a range of different options.  These options vary based on risk tolerance, and may be different from program to program. This allows account owners to accumulate, or in some circumstances, lose assets based on the performance of their investment choices. It is important to keep in mind, ABLE account owners do not need to put all their funds in just one investment choice (although they can if they would like to). 

Additionally, it is important to understand that each investment choice is typically associated with its own asset-based fee. Also, ABLE account owners can change their investment options up to two times per calendar year. Lastly, many state ABLE programs also offer what is called an “FDIC-insured savings account”.  These account options offer risk-free savings, as opposed to the various investment options which could fluctuate in terms of gains and losses.   

Topic at a Glance

Will I be asked to choose an investment option when I open my ABLE account?

The majority of programs will ask you to choose an investment option (or combination of investment options) when opening your ABLE account.

Will there be a variety of investment options to choose from?

ABLE programs offer a range of different investment options that vary in terms of risk.  Additionally, different ABLE programs may offer a different number of investment option (however most offer less than 10 investment options to choose from).

Once I choose an investment option, am I allowed to change where my ABLE funds are being invested if I would like?

Yes, an ABLE account owner may change investment direction up to two times per tax year.

If I do not feel comfortable investing my ABLE funds, do I have any other options?

Yes, many programs offer a FDIC insured option.  This option would shield the funds from any potential losses (or gains) that may be assocaited with the other options. 

Resources

View ANRC's informational videos

Stay Tuned

Register for our "Financial Literacy, Investments, and ABLE Accounts" webinar (Sponsored by Fifth Third Bank)

Many ABLE account holders have reached out to ANRC and expressed uneasiness with many financial terms involved in opening and managing an ABLE account. This webinar is designed to clarify many key terms so that ABLE account owners will feel empowered to manage their ABLE accounts in an informed and responsible way.

Click HERE for more information, including how to register.

Read a transcript from our "Ask the Experts"

The ABLE National Resource Center is always ready and willing to anwser your ABLE related questions to the best of our ability.  If you have a question or comment please click HERE to submit your question or comment and we promise to get back to you as soon as possible.

View our Friday Fast Facts

Fast Fact Friday: You can change your investment direction up to two times per tax year.

Fast Fact Friday: When opening an ABLE account, you will likely be asked to choose an investment option offered by your ABLE program.

Fast Fact Friday: Investments offered by ABLE programs will vary in terms of risk and may even offer a FDIC insured option.