ABLE investment program to help residents with disabilities

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ILLINOIS – Illinois State Treasurer Michael Frerichs announced a partnership between 14 states that will encourage residents to invest money on behalf of people with disabilities.

Frerichs introduced the National Achieving a Better Life Experience (ABLE) Alliance on Monday, which will be the country’s largest multi-state agreement. The ABLE Alliance will provide special investment tools that allow for tax-free investment growth when proceeds are spent on qualifying disability-related expenses.

Monday’s announcement culminates nearly two years of negotiations and additional states can also join the Illinois-leg group.

Ascensus College Savings of Newton, Mass., administers the program following an open and competitively bid process. The initial five-year contact can be extended up to an additional five years. The states jointly negotiated a master contract with Ascensus and then each state negotiated additional details to reflect their unique needs.

The National ABLE Alliance includes: Alaska, Arizona, Illinois, Indiana, Iowa, Kansas, Missouri, Montana, Nevada, New Jersey, North Carolina, Pennsylvania and Rhode Island.

The fee structure is the lowest in the nation. Costs will vary by participant depending upon the investment strategy. The typical fee will be 34 basis points, which is 34 cents for every $100 invested. Ascensus will work with BNY Mellon and Fifth Third Bank.

Illinois’ ABLE investment program is open to residents of other states. In Illinois, 36,000 accounts are expected to be opened by in-state residents in the first five years. Across the consortium, 500,000 accounts are expected.

More information about direct-sold plans in Illinois and signing up can be found on the Illinois ABLE website. The minimum amount to open an account is $25. Paper enrollment is expected to be available in Illinois in February. Forms will be printable online, can be requested by calling Illinois’ ABLE phone line at (888) 609-8683, and will be available at all treasurer’s office locations.

To qualify for an ABLE account, the account owner must have developed the disability or blindness being the age of 26. With the age established, a person who qualifies for Social Security Administration benefits, or has received a waiver from the IRS, will qualify for an ABLE account.

The 14 states have a combined population of 81.4 million people. Each state will have a unique start date.

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