State savings plan opens for people with disabilities

State savings plan opens for people with disabilities

RICHMOND, VA (WWBT) - People with disabilities and parents of children with disabilities now have a place where they can invest and save their money.

The ABLEnow savings program began in December. The program is administered by Virginia 529.

The program helps an individual or parents save for a child with disabilities with tax advantages, which is the same way you might save for a child headed
to college. It allows for a person to invest their money and pay for qualified disability-related expenses.

"They can be transactional, for weekly or monthly expenses, as well as saving for long term goals or short or midterm goals," said Marry Morris, CEO of Virginia 529.

The savings account will grow tax-free, like a college savings account, so you will not pay federal or state taxes on earnings while they are growing or when they are spent, as long as they are used for qualified disability expenses.

"That's a really broad array of expenses," Morris said. "Anything that can improve or enhance the quality of life for the person with the disability."

The money can be used for things such as medical expenses, educational expenses, training expenses, therapies and financial services.

The other advantage is anyone who is receiving need-based aid on a state or federal level, can open this savings account, a difference from before.

For years, people with disabilities, could not save money because if they had a certain amount of money and assets, they could lose state or federal benefits. However, with ABLEnow, they can save without losing their benefits.

Matthew Shapiro, a Richmond-area man with cerebral palsy, was the second person to open an account.

"The way the system works now (is that) you can only have $2,000 worth of assets," Shapiro said. With the ABLEnow account, he can put in $14,000 per year.

"I can finally save, which is something many people like me and many other people with disabilities have never been able to do," Shapiro said.

Shapiro talked about the motorized wheelchair he uses, which is essentially a lifeline. It gets Shapiro to and from wherever he needs to go. The wheelchair
costs $32,000.

Without this savings plan, he could be at a loss if something happened to his wheelchair. It's a similar story for other people with disabilities, who can now save in the case something happens to their mechanisms.

"Being disabled can get expensive," Shapiro said.

Shapiro will now use the ABLEnow fund as a "rainy day fund."

The disability savings account is based on federal legislation, and there are numerous states that have opened one. So far, 1,200 people have opened an account since December, and this includes people from all over the United States.

Here is what ABLEnow shared about the disability savings program:

Launched on December 19, ABLEnow— administered by Virginia529, the nation's largest college savings plan—is a national ABLE savings program offered by the Commonwealth of Virginia to meet the needs of individuals with disabilities who depend on a variety of public benefits for income, health care, food and housing assistance. Many of these benefits limit the eligibility of individuals who report more than $2,000 in cash savings, retirement funds and other items of significant value. Since its launch, the program has received more than 600 applications, which ranks Virginia's program among the top three largest national ABLE programs in the country, and makes it the country's fastest-growing ABLE program.

Click here if you are interested in opening an account.

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