Hello. I am overseeing the finances for my disabled sibling, and we have set up an ABLE account with Fidelity (Massachusetts ABLE). Since I am not very knowledgeable about finances, I feel uncertain about my choices. While reviewing the investment options on Fidelity’s fund research page, I came across this fund: FFNOX - Fidelity ® Multi-Asset Index Fund | Fidelity Investments. It seemed like a better choice than the others, but I’m worried that we might be making a mistake. There seems to be limited information available about ABLE accounts, and I’ve noticed many people reporting losses. I’ve already deposited some money into this fund for her, but I’m open to withdrawing it if this isn’t a wise investment. Thank you for your assistance.
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We encountered nothing but issues and losses with two different ABLE accounts for my son. It seems that high fees and limited investment options are common for ABLE accounts since they aren’t regulated like banks and other investments. We filed complaints regarding the lack of full disclosure about the negative ROI and found several articles discussing the problems associated with ABLE accounts. Here’s a well-researched article: How ABLE Accounts Fail Disabled People.
Ultimately, we decided to open a Special Needs Trust instead. We could set it up at any bank, and the funds could be placed in a high-interest CD (we found one at 5%) or a savings account, with a portion in a checking account for immediate needs. “High interest” is relative, of course, depending on how much you can invest, but it’s certainly better than dealing with losses and fees!
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I just wanted to add that even if they have an ABLE account, many persons with disabilities or their families could still want a special needs trust since they might need to accept assets like inheritances, sizable gifts, or life insurance payouts.
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I am getting my disability backpay soon, would I even be able to use the money in this trust, or withdraw it, or what? Would getting this be the best option?
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You would need a lawyer to set up the trust for you and answer those questions.
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Your back pay award does not count as income or assets for a certain period, which I believe is around six months, though I am not entirely sure. It is not like you receive this money and then they suddenly claim you have too much. You have probably already figured this out by now.
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I am using the most conservative option, and I am overall making a profit. Currently, the market is declining, but I expect it to balance out eventually. In the long run, things should be fine, it’s just a tough period at the moment.
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I picked the investment option that puts my money into an FDIC-insured account. It works for me.
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I am a bit worried that I did the first SSI correctly and then put it in my background after they gave me $17,000. But now that the president has approved it and new laws have passed in Texas, I’m about to do it again. The payments come in on the 25th of every month.
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The worst part of it is that I was discovered disabled before the age of 26, which is extremely suspicious. I was self-centeredly denied because some jerk could not verify my information even after providing my Social Security card number. They did it the day after they instructed me to obtain information regarding my impairment.