American Funds, a family of mutual funds from Capital Group, is launching an ABLEAmerica account, a new tax-advantaged savings plan to benefit the disabled, American Funds announced Tuesday.
The American Funds account is one of the first ABLE plans available through financial advisors for individuals with disabilities and their families, American Funds said. For 2018, the annual contribution limit is $15,000.
According to the National Disabilities Institute, about 8,000,000 Americans with disabilities are eligible for ABLE, but only 20,000 accounts have been opened so far, according to Strategic Insights, a consulting firm based in New York City. The Achieving a Better Life Experience (ABLE) Act allows individuals with disabilities and their families to invest in a tax-advantaged account, provided the account is used to cover qualifying disability expenses incurred to maintain or improve health, independence or quality of life for eligible individuals.
“People living with disabilities may face an array of financial challenges that over time can create a significant financial burden on households,” said Reagan Anderson, senior vice president at Capital Group, a nationwide investment management firm. “A skilled financial advisor can help individuals and families plan for a more secure financial future. Our hope is that opening an ABLEAmerica account can help these individuals and families, working with an advisor, pay for current or shorter term expenses and save for a better future tomorrow.”