Recently, firms in diverse sectors have begun expanding product offerings to feature accounts specifically for people with disabilities. In 2014, Congress signed the Achieving a Better Life Experience Act, or ABLE Act, which gives individuals with disabilities access to tax-free savings accounts. In the early half of this year, both Fifth Third Bank and Fidelity created new related accounts, using the opportunity to gain new clients and provide more extensive financial planning to those facing hardships.
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In March, Fifth Third Bank launched its ABLE Checking account in 11 participating states, becoming the first bank to do so. In January, the program began in Nebraska only, now expanding throughout ABLE-supporting states across the country. Fidelity announced its Attainable Savings Plan in May, offered by the Massachusetts Educational Financing Authority. Both accounts maintain traditional features, such as ATM access and credit and debit cards. Anyone can make contributions of up to $14,000 annually—the current Federal gift tax exclusion. Prior to the Act, an account of more than $2,000 jeopardized government benefits; now only accounts of $100,000 or more may risk SSI benefits. A stipulation of the accounts is that the money must be saved toward maintaining or improving the individual’s health, quality of life or independence. As the first firms of their size to release such accounts, Fidelity and Fifth Third position themselves in a niche space, spearheading new product capabilities that arrived upon the implementation of the ABLE Financial Planning Act under President Obama.
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