Rick Hodges, father of a special needs daughter, attended a financial planning seminar when his daughter was four. Mere minutes into the seminar, Hodges realized the seminar would be of little use for his particular situation. Most financial plans are predicated on the assumption that the children will grow up, go to college, become self-supporting, and then make their own financial plans for their own children. Hodges knew this would likely not be the path his daughter Audrey’s life would follow. Audrey has Downs Syndrome, and amid uncertainty regarding Audrey’s future, her father is certain she will require long-term financial support.
How the ABLE Act Came About
A group of Northern Virginia parents were instrumental in getting the Achieving a Better Life Experience (ABLE) Act through the House and Senate in December 2014. This bill reflects an increasing public awareness and acceptance of intellectual disabilities. The ABLE Act allows the person with mental disabilities to accrue a savings account with tax advantages worth up to $100,000, while keeping federal benefits. Individuals are allowed to keep Medicaid coverage no matter how large the account grows. Interest on the savings account is tax-free. Money in the savings account may come from family or friend contributions or from what the disabled person’s own earnings.