ABLE Accounts vs. Special Needs Trusts: Which One Should You Choose?
If you're caring for someone with a disability—or managing your own disability—you've probably wondered about the best way to save money without losing access to crucial government benefits like SSI or Medicaid. Two powerful tools can help: ABLE accounts and special needs trusts. But which one fits your situation?
Let me break down the differences so you can make an informed decision for yourself or your loved one.
What These Tools Have in Common
Both ABLE accounts and special needs trusts serve people with disabilities. To qualify for either option, you need a recognized disability—whether that's through Social Security's Supplemental Security Income (SSI) program or your state's disability determination services in Florida.
The main benefit? Both allow you to have assets beyond the typical $2,000 limit that would otherwise disqualify you from SSI and most Medicaid programs. That $2,000 cap makes it nearly impossible to save for emergencies, plan for the future, or maintain any real financial independence. These two vehicles offer a way around that restriction.
The Big Differences
Contribution Limits
ABLE Accounts: As of January 1st, 2026, you can contribute up to $20,000 per year to an ABLE account. That limit typically adjusts upward each year. If you contribute $20,000 in 2026 and another $20,000 in 2027 (assuming no adjustment), you're building a helpful nest egg—but there's a ceiling on annual contributions.
Special Needs Trusts: No contribution limits whatsoever. You can fund a special needs trust with $50,000, $500,000, or even more. If you're receiving a settlement, inheritance, or have substantial assets to protect, a special needs trust gives you unlimited flexibility.
Who Controls the Money
This is where the two options really diverge.
ABLE Accounts: The person with the disability can have direct access to their own money. If they have the mental capacity, they can manage their ABLE account themselves—no middleman required. Even if they need help, they can work through a representative, agent, or guardian they trust. This setup promotes independence and dignity. For many people with disabilities, being able to make their own financial decisions is life-changing.
Special Needs Trusts: The beneficiary—the person with the disability—cannot control the money directly. Someone else must serve as trustee: a family member, friend, or professional organization. While this provides oversight and protection, it also means less autonomy for the person with the disability. They have to ask the trustee whenever they need funds.
Age Restrictions
ABLE Accounts: Here's a catch. To open an ABLE account as of January 1st, 2026, the onset of your disability must have occurred before you turned 46 years old. Notice I said "onset," not when you opened the account. You could be 70 or 80 years old and still open an ABLE account—as long as your disability began before age 46. This used to be even more restrictive (age 26), so the current rules are an improvement, but it's still a limitation.
Special Needs Trusts: Generally speaking, there's no age restriction. Your disability can begin at any age, and you can become the beneficiary of a special needs trust at any age. (After age 65, you might need to use what's called a pooled special needs trust, but that's a topic for another conversation.) The point is: special needs trusts offer much more flexibility when it comes to age.
Why Not Both?
Here's the good news: ABLE accounts and special needs trusts work beautifully together.
When we draft special needs trusts for our clients in Florida, we always include language that allows the trustee to make distributions to an ABLE account. This gives beneficiaries the best of both worlds.
Remember, that $20,000 annual ABLE account limit applies to all sources combined. Whether you're contributing your own money, receiving distributions from a special needs trust, or getting help from family members, the total can't exceed $20,000 per year (as of 2026).
But here's how it can work: If you're the beneficiary of a special needs trust and don't have other sources of income or donations, your trustee can distribute up to the annual maximum into your ABLE account once a year. This gives you the financial flexibility and independence of an ABLE account while still benefiting from the larger pool of money in the special needs trust.
The Tax Advantage
There's another benefit worth mentioning: money in an ABLE account grows tax-free. Even if you're not spending much from the account right now, that tax-free growth adds up over time. It's a significant advantage for long-term financial planning.
Making the Right Choice for Your Situation
So which option is better? The honest answer is: it depends on your specific circumstances.
Consider an ABLE account if:
- Your disability began before age 46
- You want direct control over your money
- You're comfortable with the $20,000 annual contribution limit
- You value independence in managing your finances
Consider a special needs trust if:
- You have substantial assets to protect (more than $20,000 per year)
- You need or prefer oversight from a trustee
- Your disability began after age 45
- You're receiving a large settlement or inheritance
Consider using both if:
- You want the protection and unlimited funding of a special needs trust
- You also want some money available for direct access through an ABLE account
- You're planning for long-term financial security with tax-free growth
Getting Help in Florida
If you're a person with a disability, have a family member with special needs, or are an older adult seeking help with expensive medications, long-term care, or home care anywhere in Florida, you don't have to figure this out alone.
At Elder Needs Law, we help people throughout Florida protect their assets while maintaining access to the benefits they depend on. As a board certified elder law attorney, I've helped countless families set up ABLE accounts, special needs trusts, and comprehensive plans that give them peace of mind.
Additional Resources
For more information about Medicaid planning and protecting your assets, check out my book: How to Get Medicaid to Pay Some or All of Your Long-Term Care Expenses
You can also visit our websites:
Feel free to give us a call to discuss your unique situation. We're here to help you make the right decisions for your family's future.
Jason Neufeld is a board certified elder law attorney serving clients throughout Florida.
