Quick Summary

Here’s a summary of an important planning tool that more families are beginning to use: ABLE accounts.

An ABLE account is a special type of savings account designed for individuals with disabilities. It allows money to be saved and used for certain expenses—like housing, food, transportation, medical care, and education—without jeopardizing important government benefits such as Supplemental Security Income (SSI) or Medicaid.

And beginning in 2026, these accounts are becoming available to millions more people because the disability age requirement is expanding from age 26 to age 46.

Why This Matters

For many families with special needs loved ones, one of the biggest fears is this:

“What happens if they save too much money and lose their benefits?”

That fear is very real.

Programs like SSI often limit a person to only about $2,000 in countable resources. Going above that amount can create serious problems for benefits eligibility.

ABLE accounts changed that.

These accounts allow eligible individuals to save money while still protecting many public benefits.

Right now:

  • Up to $100,000 in an ABLE account does not count toward SSI resource limits
  • The annual contribution limit in 2026 is increasing to $20,000
  • Some working individuals may be able to contribute even more through special “ABLE to Work” rules

What also makes these accounts unique is the flexibility.

ABLE funds can often be used for:

  • Housing expenses
  • Rent or mortgage payments
  • Utilities
  • Food
  • Transportation
  • Medical care
  • Education
  • Assistive technology
  • Basic living expenses

And that housing piece is especially important.

Traditionally, housing support can create complicated issues for SSI recipients. But ABLE accounts can sometimes help families pay for housing-related expenses in a more flexible and practical way.

At the same time, these accounts are not “set it and forget it” tools.

The rules still matter.

For example, timing can become important. In some situations, if housing funds are withdrawn but not spent within the same month, they could temporarily affect SSI eligibility.

That’s why planning and coordination remain important.

We also often remind families that ABLE accounts are usually not a replacement for a Special Needs Trust.

Instead, they often work best together:

  • A Special Needs Trust may provide long-term asset protection and management
  • An ABLE account may provide flexibility for everyday expenses and greater independence

The right combination depends on the person, the benefits involved, and the family’s goals.

Simple Lesson

Good planning can help preserve both independence and important benefits.

Action Step

If you have a loved one with special needs, it may be worth reviewing:

  • Whether they qualify for an ABLE account – Click here to find out
  • How savings and benefits are currently structured
  • Whether a Special Needs Trust should also be part of the plan
  • How housing and everyday expenses are being handled

Make sure you take into account the “payback” rules — meaning that if the person who owns the ABLE account passes away, the state Medicaid agency may have the right to seek repayment from whatever money is left in the account. That’s one reason why it’s often important to coordinate an ABLE account with a Special Needs Trust — keeping only limited funds in the ABLE account for flexibility and day-to-day use, while preserving longer-term protection in the trust.

Sometimes small planning changes can create much more flexibility and peace of mind for families.

If you’d like to talk about your estate plan or long-term care planning, we’re always happy to help.

Call us at (517) 548-7400 or contact us through www.MichiganEstatePlans.com.