New Bill Aims to Help Low-Income Americans with Disabilities Build Emergency Savings Through a Federal Match
The Americans with Disabilities Act (ADA) marked a significant milestone in promoting the rights and protections of individuals with disabilities over three decades ago. However, despite these advancements, disabled Americans still encounter formidable challenges, especially in accumulating wealth and building emergency savings. To address this issue, Senator Bob Casey, a Democrat from Pennsylvania and the chairman of the Senate Special Committee on Aging, has introduced a groundbreaking proposal known as the ABLE MATCH Act. This legislation seeks to ease the financial burden faced by low-income disabled individuals by providing a federal dollar-for-dollar match of up to $2,000 for their ABLE accounts.
The Plight of Low-Income Disabled Americans
Living with a disability can impose significant economic hardships on individuals. Disabled Americans are twice as likely to live in poverty as their non-disabled counterparts. They encounter various financial hurdles, making it incredibly challenging to build a financial safety net for emergencies. This is where the ABLE MATCH Act steps in, offering a lifeline to those who need it most.
Understanding ABLE Accounts
ABLE accounts were established through federal legislation in 2014 to address this issue. These accounts allow qualifying individuals to set aside money for disability-related expenses without jeopardizing their eligibility for crucial federal programs such as Medicaid or Supplemental Security Income. ABLE accounts come with tax advantages, permitting tax-free withdrawals for qualifying expenses while allowing investment gains to grow on a tax-deferred basis. However, despite their potential benefits, many low-income disabled individuals struggle to initiate these accounts due to financial constraints.
The ABLE MATCH Act: An Overview
Senator Bob Casey's ABLE MATCH Act is a pioneering piece of legislation aimed at boosting enrollment in ABLE accounts for low-income disabled Americans. Under this act, individuals who earn $28,000 or less annually would receive a federal match of up to $2,000, effectively doubling their savings efforts. This financial assistance would taper off as individuals earn more income over the established threshold. Additionally, the threshold would be adjusted for inflation, ensuring that the benefits remain relevant and equitable over time.
An Incentive for Financial Security
The introduction of the ABLE MATCH Act is an exciting development in the realm of disability rights and financial security. Thomas Foley, the executive director at the National Disability Institute, notes that this legislation provides a much-needed incentive for a group of people who have historically faced disincentives to save. Disabled individuals, particularly younger ones, often struggle to set money aside in ABLE accounts due to limited disposable income. The additional costs associated with living a lifestyle equivalent to that of non-disabled individuals can be staggering, including expenses for accessible transportation, proximity to work, or the upkeep of service animals.
Expanding Access to ABLE Accounts
Notably, recent legislative changes have extended the age limit for the onset of a disability from 26 to 46 for participation in ABLE accounts, beginning in 2026. This adjustment could potentially make as many as 14 million more people eligible to benefit from ABLE accounts. These changes, combined with the ABLE MATCH Act, have the potential to significantly improve the financial security and overall quality of life for countless low-income disabled Americans.
Conclusion
The ABLE MATCH Act is a vital step toward addressing the economic disparities that disabled individuals face, particularly those with limited incomes. By providing a federal match for ABLE accounts, this legislation offers a much-needed financial boost to those who are often overlooked in the realm of savings and wealth accumulation. Senator Casey's proposal demonstrates a commitment to ensuring that all Americans, regardless of disability, have the opportunity to build a secure financial future. As we look toward a more inclusive and equitable society, initiatives like the ABLE MATCH Act are essential in breaking down barriers and promoting financial well-being for everyone.