CalABLE: Essentials and Why It Matters

Looking to save for your child’s future without affecting their eligibility for government programs? CalABLE is a savings and investment plan offered by the state of California to individuals who developed a disability by age 26.

As part of our summer training series, CalABLE Outreach Specialist Madeline Handy joined us to look closer at how parents of kids with disabilities can use this program to help provide for our children’s care. Watch the full replay above, or catch a recap of the highlights here in our free resource library.

LC:
Hello, everyone, and welcome to Undivided Live. I'm Lindsay Crain, and I head the content and community teams here at Undivided, where our mission is to ensure that every child with disabilities can access the services and supports they need when they need them. And we know that's often easier said than done, which is why we built an entire software platform to help families organize, prioritize, strategize, and execute, and why we love events like today. So if you're here, you're already a step ahead. even if it doesn't feel like it. So thank you for joining us for another session of our summer training series.

Today, we are going to talk all about CalABLE accounts. Let's be honest, financial planning is not usually a favorite pastime for most parents, and it definitely carries extra weight for those of us raising kids with disabilities. It's the stuff we don't want to think about, but we know we have to. And as much as we'd love to push it off, there are advantages to planning ahead. And so like with everything, we hope that jumping in and learning about the various programs that can support your child and your family can actually bring some relief instead of more stress. So when we talk about future financial planning in CalABLE, some things we often hear are families aren't sure if they need to think about this if their kids are young or that many families don't have extra funds to put into an account so they don't think it applies to them. There are also a lot of questions about how it could affect their child's other benefits. And some families wonder if this is really necessary if their child will be working in the future or if their child's support needs dictate their eligibility. So let's talk about it. We want to clear up the myths, learn the facts, and get you the information you need to start this process when you're ready.

So thankfully, we have an expert to walk us through exactly what we need to know. We are so happy to welcome today outreach specialist from CalABLE, Madeline Handy. Welcome, Madeline.

MH:
Hi, thank you, Lindsay. Thank you for having me on today. I'm definitely excited to be here and speaking about CalABLE.

LC:
Yes. A couple housekeeping items before we jump in. Well, Madeline attended UC Davis where she completed her Master of Public Health. During her MPH program, she interned for CalABLE and researched how having a CalABLE account can improve a person's health. Very important. She is now a full-time outreach specialist for CalABLE. So thank you so much for being here, Madeline. And normally our live chats are more of a conversation back and forth with questions throughout, but our summer training series utilizes a more traditional slideshow format to cover a lot of details in a structured way in about an hour. So Madeline's presentation also gives you a great visual guide to refer back to. And our community manager Donna is in the chat with you today. She'll be collecting any questions that Madeline won't be covering in her presentation. We'll get to as many as we can at the end if they haven't already been answered. Donna will also be sharing links in the chat. Some are direct links from Madeline and others are article links where you can find additional information on what we're discussing today. And Donna will be sharing the link to Madeline's slides so you'll have direct access to what Madeline is presenting after the event. And lastly, if you want to turn on your captions, you can click on the CC button below the video. You can also change the language of captions to your preference. And with that, we have lots to cover. So let's jump right in. Madeline, take it away.

MH:
Great. Thank you. Hello, everyone. Like Lindsay said, my name is Madeline Handy. I am an Outreach Specialist with CalABLE. And today I'm going to be sharing with you information about CalABLE and how it can support your child with a disability. And so CalABLE is a financial program for the disability community. And so we here at CalABLE believe that everyone with a disability should know about CalABLE. So what exactly is CalABLE? So the ABLE part of CalABLE stands for Achieving a Better Life Experience. And this is part of the ABLE Act, which is a federal law that was signed in 2014 that enabled states to open these tax advantage savings and investment programs that are really designed to help people with disabilities achieve their financial dreams. And so CalABLE is California's version of the ABLE Act. And so really the point of these programs is that they allow people with disabilities to save money without losing their eligibility for other benefits. And then the money in these accounts grows tax-free and it is meant to be used for qualified disability related expenses, which are really anything that can help somebody improve their quality of life. And I will dive into qualified disability expenses later in the presentation. And so why do we need CalABLE? So it's really no secret that living with a disability can be extremely expensive. People might have extra costs for things like medical treatments, accessible housing, adaptive equipment, assistive care, and many more things that somebody without a disability will not need. And so for many people who live with disabilities, finances can be a huge burden and financial stability can be hard to achieve. In fact, the National Disability Institute found an adult living with a disability has to spend 29% more of their income to tame the same quality of life as someone without a disability. In many cases, this percentage is much higher.

So, you know, as you're thinking of your child and their future, this is just something to keep in mind that there are going to be these additional expenses. And so that really is where CalABLE comes in. And so as you might be aware, if you're on SSI, you can't have more than $2,000 in a bank account. Otherwise, the SSI benefits may be at risk of being suspended. But for many people, they need SSI in order to have a quality of life that they need. But $2,000, that's not a lot of money. You really can't save up to buy things that you need and that you want with $2,000. So that is really where CalABLE comes in. So with a CalABLE account, people with disabilities can save up to $100,000 directly in a CalABLE account without impacting SSI and other benefits. And then the money can be used to improve their quality of life while pursuing their goals. And so opening a CalABLE account can really be a life-changing experience. So on this slide, I have just a few facts about CalABLE. So CalABLE is administered by the state of California and chaired by the state treasurer. So we are a state-run program. Currently, we have more than $140 million in assets under management, and more than 11,000 people have trusted CalABLE with their savings and investments. And while we are very proud of these numbers, there are so many people who are eligible to open CalABLE accounts who haven't yet. And so that is why I'm here sharing this information with you. And so the CalABLE program currently is available to anyone whose disability started before age 26. And I will dive into the eligibility details in just a moment. And so in this presentation, I'm going to be answering some of our top questions.

So first starting with who is eligible. Second question will be how much can somebody save? What do you spend your money on? How do you open an account? My personal favorite question is how do I maximize my CalABLE account? And then question number six will be why choose CalABLE? So who is eligible? So like I mentioned before, people are eligible for CalABLE if they have a disability that began before age 26. So this doesn't mean that somebody has to be below the age of 26. They can actually be any age and open a CalABLE account. It's just that the onset of the disability has to have been prior to age 26. and this is also not the age of diagnosis somebody can be diagnosed later in life but as long as their disability likely started before age 26 they would be able to open a CalABLE account and then if you meet the eligibility criteria for disability benefits like SSI or SSDI, just Supplemental Security Income, or Social Security Disability Insurance, you are automatically eligible to open a CalABLE account. But this doesn't mean that you have to be on benefits.

So to open a CalABLE account, really it's a self-certification process. And so we recommend for everybody that you go ahead, look on the SSA list of compassion allowances or blue book listing just to confirm that your disability is on there. And then we recommend that you receive a signed letter from a qualified physician basically just stating that the onset of the disability was prior to age 26. This is for your benefit. You don't have to turn this into CalABLE, but we just recommend having it on file in case someone were ever to apply for benefits. Um, or in case somebody like the IRS asked, these are tax advantage accounts. Um, so the IRS could ask, we've never seen that happen, but we just want people to be prepared just in case. Um, but it's a very easy process. Um, you don't have to go through a whole lot of steps to confirm your disability. It's a self-certification process.

And so how much can somebody save with CalABLE? So in 2024, the annual contribution limit for CalABLE is $18,000. This limit is tied to the gift tax exemption limit. So it can change from time to time. We've seen it gone up. In 2023, it was 17,000. It's now in 2024, it's 18,000. And so hopefully it'll continue to increase. And then for those who are on SSI benefits, the total cap for a CalABLE account is $100,000. So that is both contributions and then any growth on the account. And so if somebody is on SSI and wants to protect their benefits, they'll have to keep that $100,000 limit in mind. This limit is only for SSI, so the same benefit limits doesn't apply for something like medical or section 8 housing but you will want to keep this limit in mind if you're eligible for your other benefits through ssi And then for those who aren't worried about SSI, the total contribution cap for CalABLE is going to be 529,000. And so at that point, you wouldn't be able to contribute any more money to the account, but the account could still continue to grow. And then CalABLE will automatically reject excess contributions, so you don't have to worry about going over that $18,000 limit because you won't be able to. And so throughout this presentation, I have put in some quotes from our CalABLE ambassadors. These are real life account holders who are using their CalABLE accounts and can help share the benefits. And so this is Raymond, and he has said, without CalABLE, I feel like I would be constantly looking over my shoulder, checking my bank balance, making sure it was under $2,000. with CalABLE, I've been able to achieve financial peace of mind. And so I think this just really highlights how CalABLE can really give peace of mind, allow people to save while still being on SSI and maintaining benefits and not having to constantly worry about keeping that money below $2,000. Because with CalABLE, you can have up to $100,000 without impacting SSI benefits. So there are some people who can actually contribute additional money to their CalABLE accounts if they are working. And so for those who are working and not contributing to an employer-based retirement plan that calendar year, they can actually contribute an additional 14,580 into their CalABLE account. And so this can really allow somebody to grow their CalABLE account a lot faster. And so this aspect is really great for people with disabilities who may not be eligible for retirement, employer-based retirement plans. Maybe they're only able to work part-time either to keep their benefits or because of their disability. And so they're not eligible for an employer-based retirement plan. And so with ABLE to Work, they're able to save that money for their retirement or other needs that come up and so this is a really fantastic feature of a CalABLE account.

And so what can somebody spend their money on? So this is definitely one of our most frequently asked questions and so really people can spend their money on anything that helps them live their best life. And so these are qualified disability expenses. And the definition of a qualified disability expense is any expense that helps the account holder maintain or improve their health, their independence, or their quality of life. And so that is the definition of a qualified disability expense. I know it's broad. It is intentionally designed that way so that people can really spend the money in these accounts on the way that can best improve their quality of life. So obviously, these qualified disability expenses, they're personal. It's education, housing, transportation, health prevention, and wellness. And so these accounts are really designed for a whole wealth of expenses to really allow people to achieve a better quality of life. And so on this slide, I have examples of qualified disability expenses. This is not an all extensive list at any means. Um, so for example, education that could mean tuition that could mean books that could mean, um, a laptop maybe for school, um, housing that can be rent. It could be a mortgage payment, um, and then health prevention and wellness. So any medical costs that aren't covered by insurance, um, it could even be a vacation, for example. Um, so really people always ask, you know, is this a qualified disability expense? Is this one? And really the answer is if the expense improves health independence or quality of life in some way, It is a qualified disability expense. And CalABLE does not ask people what they are using their account for, but we just recommend that people keep a record just in case Social Security were to ask if you're on benefits or potentially the IRS. Again, we've never seen that happen, but just in case we want people to be keeping track of those expenses.

And so here is another quote from one of our account holders, Cheryl. She is an authorized legal representative for her two sons who have CalABLE accounts. And so she has said, ABLE enables me to be able to provide tools for my children to help them better communicate and relate to the world. And so for Cheryl, she has used the funds in her son's ABLE accounts to give them art therapy and horseback riding therapy lessons. And so she's really thinking creatively about what can help her sons, you know, better communicate and achieve a better life experience. Here's another quote from Ashley. She is a parent to her son. And so she said, we sold our old car and use the money in our CalABLE account to have extra money to buy a bigger, nicer chair. And it fits his wheelchair amazingly. And so I really love this example of Ashley and her son because what happened was her son he's growing. And so he outgrew his wheelchair. And so, you know, they had to fight to really get that bigger wheelchair. And when they finally got it, you know, it should be this huge victory, but then it didn't fit in their car. And so what they were able to do is they sold their old car that was too small. And then they use that money as well as money in the CalABLE account to be able to buy a bigger, nicer car to help transport Dylan around and get him to the places he needs to go. And so I really love this example because it highlights how a CalABLE account can be used to really buy things that can help everyone. And so the money doesn't just have to be used for the person with disabilities. It has to be used for their benefit, but other people can use it. So for example, with this car, Dylan, he's 10 years old. He is definitely not going to be the owner of the car. He's not going to be the one driving it, but because he benefits from that purchase, it is a qualified disability expense. And so really when you think about these qualified disability expenses, it just has to benefit the person with the disability, the account owner, and it has to improve their quality of life, their health, or their independence in some way.

So how do you open an account? So there are some things to be aware of before opening an account. So participants can only have one ABLE account. So like I mentioned at the beginning of the presentation, the federal ABLE Act enabled states to open these programs. So there are a lot of different ABLE programs available. We always recommend looking at your home state's ABLE program first, because there may be additional benefits for in-state residents. So for example, in California, CalABLE accounts are protected from Medi-Cal recovery. So that is one reason why somebody in California might wanna look at CalABLE first. And so you can only have one ABLE account, so you wouldn't be able to have a CalABLE account and then an ABLE account in another state. You're only able to have one, but you can roll over the ABLE account if you want to be in a different state. And so then another thing to be aware of is that the person with a disability is always the ABLE account owner and beneficiary of the funds. They are in charge of their own money. So this is a really great feature about how ABLE really allows people to have that self-control, that independence. But the account can be opened by the person with disability or by an authorized legal representative. And so who can be an authorized legal representative?

So an authorized legal representative, basically somebody who would open the account for the account beneficiary, and they would be the one who has the username and password. They would be the one who controls the account. And so in the case of somebody who is under 18, they are not able to open a CalABLE account by themselves. So they would have to have an authorized legal representative. And so on this slide, I have a list of everybody who can be an authorized legal representative. So it starts with power of attorney, and then legal guardian or conservator, a spouse, a parent, usually when somebody is under 18, it often is the parents. But we've also seen grandparents, for example, siblings can be authorized legal representative, even representative payees, and really anyone requested by the account owner. And so the authorized legal representative, they would be the one who would be making decisions on the account if somebody is under 18 and unable to open their account, or if they are unable to manage their own finances, or if they simply want to have somebody else manage their finances for them. And then once somebody turns 18, at that point, they could take over the account themselves if they feel like they can manage their own funds. Or they could still have an authorized legal representative on the account, managing the account for them. And so to open an account, you go to our website, which is calable.ca.gov. The whole account enrollment process is done online. Unfortunately, we don't have a physical location where you can go to open an account in person. But we do try to make the process as easy as possible. The whole process takes about 20 to 30 minutes if you have the information you need. So you need name, social security number, or a tax identification number. address, those sorts of things. And then you go through the process. And then this is also where you go to log into the account. And this website has a wealth of information on it about how CalABLE works, eligibility benefits, the investment options. So this really is a great resource.

So question number five, how do I maximize my CalABLE account? And so really there are three key ways to maximize a CalABLE account. So you can save money, you can grow money and you can spend money. And so I already talked about the contribution limits. So there's that $18,000 annual contribution limit. So how does somebody actually get the money into a CalABLE account? So the easiest way is to link a bank account and do electronic transfers. You can also set up recurring contributions. So they set it and forget it sort of thing. There's also the ability to do direct deposit of social security benefits and even payroll at work. And then you can also mail checks to CalABLE. One really fantastic feature about a CalABLE account is the ability for other people to gift to the account. And so with a CalABLE account, you can go in, set up a gifting page, and this will create a link that you can then send out to friends and family on social media or through email. And then people can click on that link and contribute directly to the CalABLE account. The great part about this is that the gift contributions don't count as income. So this can be really great for somebody, you know, if your friends and family wants to help with rent, for example, they can contribute directly to the CalABLE account and it will not impact the amount of benefits that are received. So this is a really fantastic option. We encourage people to set up their gifting page for the holidays, for graduation, big life events, and ask their friends and family to contribute directly there so that it won't impact benefits.

So here is a quote from account holder Hector. He said, for my birthday, I asked folks, this is my ABLE account, you can make a donation. And I ended up getting enough money to put down the down payment for a two bedroom, two bathroom mobile home. And so as you can see, a CalABLE account can really be life changing. It can really help people, you know, improve their life.

So the next really great way to maximize the CalABLE account is to invest the money there. And so a lot of people will say, I'm not on benefits. So is there even a point for me to open this CalABLE account? And there is. So with the CalABLE account, you can invest the money into professionally managed investment portfolios, and it has the opportunity to grow tax free. So this is a really fantastic opportunity to build wealth through compound earnings. I like to compare CalABLE accounts to Roth IRAs, where it's that after tax money that's going into the account and growing tax free. But the best part of a CalABLE account is that the money can be taken out at any time. So you don't have to wait until a certain retirement age like you would with a Roth IRA or other retirement accounts. And so with CalABLE, our money is in Fidelity, Schwab, and Vanguard. So these really trusted sources. And so with CalABLE, we offer eight different investment portfolios. We try to make this investing process as easy as possible. And so these are weighted by risk. So there is the FDIC insured portfolio. This is most similar to a savings account. It has a set interest rate of about 2%. And then we also have seven different investment portfolios. And so they start with the least risky. So that is the income portfolio, which is mostly made of bonds and money. the market securities. And then as you can see, as these go up in risk, the ratio of stocks goes up. And so risk is the potential that you could lose money, but also the potential that you could earn money. So with a higher risk, there's a higher potential growth, but also higher potential loss, depending on how the investment marketplace is doing. So here at CalABLE, we can't give investment advice, but we can give some scenarios to think about when selecting these investment options. And so some things to think about are one that risk tolerance, how okay are you with risk? And so some people they are not very risky, they don't want to see the money go up and down. And so they might pick something like the FDIC insured portfolio, or maybe one of these other investment portfolios with lower risk. Other people, they're thinking really long term, they're okay, kind of writing out the investment marketplace. And so they might pick something with a little higher risk, like the growth portfolio. The other thing to think about is what are the goals for the CalABLE account. So for somebody who's using their CalABLE account for more day to day expenses, like bills, for example, or food, they might do the FDIC insured portfolio. For somebody who's thinking more long term, they have a further out goal in mind, like buying a house or car, for example, or maybe saving for college, they might do something with a little higher risk, something a little bit more long term.

You can also do multiple portfolios so you can mix it up. You can put some of your money in the FDIC insured portfolio, some in the conservative growth portfolio. So there's a lot of flexibility here to really customize your investment portfolios for your own personal savings goals, as well as your own risk tolerance. And then you can only say or you can only change your investment portfolios twice per calendar year. So that would be if you had money in the growth and then you moved it to somewhere else, that would be a change. You can always put money into a new portfolio. That is fine. But changing it, that is limited to twice per calendar year. And so here's another quote. This is Otto. He actually just graduated from high school, and he actually just became the account holder for his account. Initially, his mom was his authorized legal representative, but when he turned 18, he said, I really want to take control of this account. He said, I am still very young. That is the perfect time to start investing. CalABLE has given me that tool to be able to invest in my future just like everyone else. And so Otto, he's very interested in financial education. He really wants to be able to use the CalABLE account to achieve that better life experience. And so Otto has taken over the account and is managing it on his own. Okay, so now for maybe... Not such a fun thing, but it is important to talk about.

We always want to be transparent here at CalABLE. There are some fees that are tied to the account. We try to keep the fees as low as possible, but we do need to have some fees for account maintenance, for our program manager who's running the account, and then for the state as well. So this example assumes that somebody has $3,000 in their CalABLE account. And so with all CalABLE accounts, there is an annual account maintenance fee of $30 per year. This is a flat fee for having the CalABLE account. So it doesn't matter if you're in the FDIC insured portfolio or also in the investment portfolios, you aren't charged twice for this fee. It's just one $30 fee for having the account. And then if you are putting money into the FDIC insured portfolio, there is a state administrative fee. This is a percentage based fee. So it depends on how much money you have in the account. It is 0.28%. And so with $3,000 in a CalABLE account, that state administrative fee would be $8.40. And then for the investment portfolios, there are some additional investment fees. These are also percentage based fees. So it will depend on what you have in the account. Um, but generally the fees will range between. If you had $3,000 in the account between $38 and 40 cents to $46 and 63 cents per year. Uh, these fees are taken out on a quarterly basis. Um, so. you know, for the $30 fee, it'd be $7 and 50 cents each quarter. And the really important thing to remember is that these accounts are investment accounts, and they grow tax free. And so we really want to encourage everybody to keep contributing to the account. And with the goal that the investments, the growth on the account will outweigh these fees. And then there is a $10 fee if you would like paper statements. But of course, there's no fee for the electronic delivery of statements.

So now going a little bit more back into the fun topics, spending your money. I already talked about those qualified disability expenses, but how exactly do you access the money to spend it on qualified disability expenses? So you can do the electronic transfers to a bank account. You can also have checks be written, but we really want to encourage everybody to use the prepaid card. And so with CalABLE, we offer a free reloadable prepaid card. This is a Visa card that allows you to pay for qualified disability expenses anywhere that Visa is accepted. There's an asterisk there because you're not able to get cash with the prepaid card. But you can do pretty much anything else. You can go to the grocery store, buy food. You can use it for online purchases. This is a really great feature. It is reloadable. So you don't have to just get the card and then have the set amount on it. You can reload money from the CalABLE account onto the card. The great thing about this is you can customize spending with the card. So you can set where the card will and won't work to avoid fraud. And there's the ability to have two separate cards for what's the one for the beneficiary and one for the authorized legal representative. And so this is really great for somebody who is maybe a first time saver, a first time budgeter. You can give them the prepaid card set where it will and won't work. You can also just upload a small amount to the card and really allow people to practice using the card practice budgeting. They won't have access to the whole account, but they can have access to some of that money to allow them to practice spending without, you know, going through all of their savings. And then the prepaid card is also really great for tracking those qualified disability expenses. So you can even upload receipts to the prepaid card. So this is a really great feature. We highly encourage people to use it. There are no monthly fees tied to the card. We at the CalABLE program worked really hard to make sure there were no fees with the card because we think that this is such an important feature for people.

So why choose CalABLE as opposed to something like a special needs trust? So we get this question all the time. Should I open a CalABLE account or should I open a special needs trust? And really the answer is it's not a, either, or it's a yes. And so we definitely recommend, you know, looking at both. There are some differences, but they actually work really, really well together. And so on this slide, I have a comparison here. So some of the key differences are that the CalABLE account can be opened online in 20 minutes or less. Generally with a special needs trust, you're going to have to work with an attorney to create it. That also means that often the cost of a special needs trust is going to be a bit higher than a CalABLE account. CalABLE accounts are free to open. And like I mentioned, our fees start at just $30 a year. With a CalABLE account, the individual with the disability is the owner and they or the authorized legal representative will manage and spend the money. With a special needs trust, a trustee manages the trust and has sole discretion over spending. Um, with the CalABLE account, there is a broad range of allowable uses, including food and housing, uh, with special needs trust. It really, it depends on how the trust is written. Um, and then with CalABLE accounts. So here's one of the reasons that special needs trust might be something you look into. So with the contribution limits, CalABLE is limited to that $18,000 per year. With a special needs trust, there are no deposit limits. So this is a really great option if somebody receives an inheritance or a large payout that is over $18,000, a special needs trust would be a great option. And then a CalABLE account is really great too, because anyone can contribute. So we do have that gifting page. So that can be a really great feature. With a CalABLE account, with Medi-Cal paybacks, like I mentioned, Medi-Cal will not seek recovery from a California resident with a CalABLE account. With the special needs trust, only first party trusts must pay back Medi-Cal. With the investment options, CalABLE has eight options. So it really offers the ability to grow your money. And there is also that tax free withdrawals for qualified disability expenses. So I think that's really important with a special needs trust.

There are investment options as well, but the earnings are going to be taxed. And so, like I mentioned, CalABLE and special needs trust actually work really well together. What we see a lot of the times is people will open special needs trust for those large amounts of money that inheritance or, you know, for those thinking more long-term and then people will transfer money from the special needs trust into a CalABLE account for more flexible spending. So. Definitely encourage everybody to look at both these options. It's always important to be informed. And we definitely recommend doing what works best for you and thinking if they could work together.

And so why choose CalABLE? So throughout this presentation, I've given you a lot of things to think about, but really CalABLE empowers the person with a disability to save and plan for their future. It really puts the person with a disability in the driver's seat and lets them have control of their finances. With the CalABLE account, benefits are protected. So you can save money while still being on SSI, Medi-Cal, Section 8 housing, these really important benefits. The money is also protected from Medi-Cal recovery. So super important upon somebody's death, the money can then go to who they want it to. With a CalABLE account, family and friends can contribute to the account through that gifting feature and it won't impact benefits. the money also grows tax-free which is huge it's a really great benefit of a CalABLE account and then you can take the money out at any time to spend on items and experiences that can help improve quality of life again those qualified disability expenses super broad because they are designed to help the person with a disability really achieve a better life experience in the best way for them And then with the CalABLE account, you also become part of the CalABLE community. And so we are CalABLE. And like you saw through the presentation, there were all those great quotes from our CalABLE ambassadors. We have some videos on our YouTube channel where they actually speak about their experiences themselves. They do a much better job than I do. So I definitely recommend checking out our CalABLE YouTube channel to really see how real life people, the CalABLE community are using their CalABLE accounts.

And so highly want to encourage everybody to get started today. The sooner that you get started, the sooner you can start saving for your child's future. And then to contact us if you need help setting up the account, or if you have questions about doing something in the account, like getting the prepaid card or setting up a gifting page, you can always give us a call at the CalABLE Customer Service Center, which is 833-225-2253. That's also 833-CAL-ABLE, so it makes it pretty easy to remember. And they're open between 6 a.m. and 5 p.m. Pacific. And then if you have any questions after hours, you don't want to forget it. Or maybe you just don't feel like talking on the phone, you don't have time, you can use the customer support form on the website. And so that is available on our website as well. We do have resources available. So we have a partner toolkit. If you're really inspired about CalABLE and want to help share the word, you can find the partner toolkit on our website. We also have brochures available. So maybe you're part of parent groups or part of a community group and you want to share CalABLE, you can always email us and we can send you some brochures. And then we are on social media. So we're on Instagram, Facebook, Twitter, LinkedIn, and YouTube. So highly recommend following us. We try to post every day. So it's a really great way to stay up to date with CalABLE. And then like I mentioned, our YouTube channel, it has a great wealth of information. It has those ambassador videos on it. And it also has our past webinars. So if you are more curious about CalABLE and special needs trust, we actually have a full webinar that just focused on that topic. And so you can go to our YouTube channel and check it out. There's also a YouTube video on opening a CalABLE account. So the YouTube channel is really a great resource.

And then lastly, I do want to share the disclosure. And so CalABLE, I'm not going to read the whole thing. But CalABLE is an investment program. And so like I mentioned, there are some risks involved, there is that risk that you could lose money. And so we want people to be aware of these risks before opening account. So we highly recommend taking a look at the disclosure, reading it, So you can be aware of the risks, but also the benefits of CalABLE. There's a lot of information about this program. And so the disclosure really is the guide to CalABLE. But of course, if you don't feel like reading the full disclosure, you can always give us a call at that 833-225-2253 number and ask questions and we can provide you the information that you're looking for. And then lastly, so here is the CalABLE team. We are a small staff at the state treasurer's office covering the whole state, but we are also here to answer questions. So there is Thomas Martin, our executive director. There's Anne Osborne, a deputy executive director. There's myself, Madeline Handy. And then there's also Maria Sandoval. She is our Spanish outreach specialist. And so if you have, you know, questions about the account, you can also reach out to our office directly. You can always email us at calable at treasurer.ca.gov or give us a call at 916- 653-1728. And that would be the email to call if you would like brochures or maybe a partner toolkit. So definitely contact us if you need information. And so thank you. I appreciate being here and you listening to me speak about CalABLE and hopefully I've provided enough information that you can take the next step to open a CalABLE account. Thank you.

LC:
Thank you so much, Madeline. You covered many of the questions that were coming in and questions that we received ahead of time during the presentation, but we do have time to address a couple more now. I wanted to... not to scare anyone, but about things that are not covered. Because I know you touched on this, and I think I had read on your site, so please correct me if I'm wrong. But if we do spend the funds on something that's not eligible, it can count as income and affect Social Security or Medi-Cal. So it can have some serious consequences so are there is there a fail-safe way to know that an expense is legal or allowed since it is a broad definition just something you know for parents to keep in mind or individuals

MH:
Yeah definitely, so there's not too many things that aren't considered qualified disability expenses um but some things that wouldn't be would be gifts for other people for example So qualified disability expense, it does have to be for the benefit of the person with the disability. So they couldn't use the money in the CalABLE account to get like a Christmas gift for somebody else. That wouldn't work. And then things like gambling, that's not a qualified disability expense. You know, anything illegal would not be a qualified disability expense. But really just keep in mind that definition, you know, if it improves health independence or quality of life, it is a qualified disability expense.

LC:
And, and I know when you talked about eligibility, cause that's some of the questions we received a lot of questions ahead of time. Right. And I know, you know, you made it very clear that even if an individual doesn't have benefits, they can still apply and it's really. up to the individual to put the information down. Obviously, there was a physician's form, I think, right? I think Donna shared that in the chat. So just to be really clear, so there isn't sort of some hard limit of what an individual's support needs might be for them to qualify for CalABLE. I just wanted to really sort of underline that since it's a really common question that we received.

MH:
Yeah, great question. So yeah, as long as the disability is on the SSA list of compassion allowances or the Blue Book listing, it would be a qualified disability expense. Or sorry, you would be eligible for CalABLE. And so, for example, sometimes we like to use autism as an example, especially because somebody could be diagnosed later in life with autism. And so because it is a developmental disability, somebody has always had autism. And so our executive director, Thomas Martin, he is actually an individual with autism. And so he has a CalABLE account because he has an autism diagnosis. LC:
Okay. And then here are a couple of questions that we received with our RSVPs. So can you have child support payments directed into a minors CalABLE account?

MH:
That is a great question. I'm not sure about the capability. That might be a question for the customer service center to see if they could help set that up. Yeah, I'm not sure off the top of my head.

LC:
And if an adult child lives with their parent, can you pay part of a rent or mortgage from your CalABLE account?

MH:
Yes, yes. So like with the example of Ashley, where they bought the car with the CalABLE account. So the money has to benefit the person with disability and rent, housing, that is extremely important. And so you would be able to pay for a portion of the rents there using the CalABLE account because the person with a disability will benefit from that.

LC:
Okay, great. And I think that you might have answered this, but does kinship guardianship change the relationship of the CalABLE account to the child it is open for?

MH:
Um, so, um, with the authorized legal representative, um, really anybody selected by the person with a disability can open the account. Um, so somebody with guardianship would definitely, they qualify as an authorized legal representative, um, siblings, they also qualify. And then, you know, anybody who's selected by the beneficiary also qualifies as an authorized legal representative. Okay. I'm not sure if I answered that correctly. Right.

LC:
Yeah, I think that you did. How I'm interpreting it as well. And that didn't come in live. That did come in with RSVPs. But we also did have a question about social security numbers. So to clarify, you do need a social security number. The individual who will be benefiting, the individual with disabilities needs to have a social security number to have a CalABLE account. Does the authorized legal guardian also need a social security number?

MH:
Yes, they do. And or they could have a tax identification number that also works.

LC:
Okay, got it. um and then Francine I saw your question about um if we need help or have questions signing up I think you know madeline did share that information so you should have the answer to that question um if you don't I'm sure donna can re uh put the link in the chat again but um thank you for for offering that as well Madeline so for any questions to call your small but mighty team.

MH:
And I would say, for help, like opening an account or doing something in the account, I would recommend reaching out to that 833 CalABLE number, because they actually have access to the accounts. And so they'll be able to like help walk you through the process. At the state treasurer's office, our team, we don't have access to the behind the scenes. So we can always answer questions about, you know, laws about benefits, that sort of thing. But if you have a question about How do I set up something in my account? We will direct you to the 833 number.

LC:
Definitely. And Jen asked, she said, sorry if I missed this, but if they are dependent on parents' taxes, does that change anything?

MH:
Um, no, that shouldn't. And so that actually brings up a really good point about taxes. And so if you open an account for your child, even if they're dependent on you, them having the CalABLE account won't impact your taxes. And also having a CalABLE account doesn't require somebody to file a tax return. If they are already having to file a tax return because they work, then there is a section to put in information about the CalABLE account. But just having a CalABLE account doesn't require somebody to file taxes.

LC:
Got it. I think we answered Jen's question about special needs trust. So Carrie said, so SSI can be directly deposited into the CalABLE account, correct? I believe you said that, right, Madeline?

MH:
Yes, yes. It does have to be the full amount. So yes, you can do that. It will have to be the full amount. You can also have the SSI contributed into a bank account and then just transfer the money, any excess into the CalABLE account. That works as well.

LC:
Okay, and I think you can see here the rest of Carrie's question. She said, there's something I keep hearing about spending SSI for rent in the same month it is deposited. Does that only apply if it goes into a standard bank account?

MH:
So that is a great question. Thank you for bringing that up. And so with housing specifically, the money does have to be spent or taken out of the CalABLE account and spent within the same calendar month. That is specifically for SSI. Um, and so something that we would recommend is let's say rent is due at the first of the month. Um, you might want to pull the money out the month prior and then pay for the next month's rent that calendar month. Um, so yeah, it's very important for SSI and housing expenses specifically.

LC:
And, and just to, to be really clear. for folks listening, if it isn't spent within the same month, then what happens? Is it considered income and it can affect your SSI benefits?

MH:
Yes. Uh, so it would be considered a resource, um, believe, and it could impact your SSI benefits. The social security actually has a program operation manual system where they go through, um, you know, how social security representatives are actually supposed to look at this money. Um, so they have examples there. You can see if, um, I can pull up that link. but it's also on our website as well. And actually our website also has letters from different benefits like Section 8 Housing and Medi-Cal that says exactly how those benefits are supposed to handle CalABLE accounts. um and so those are really great if you're talking to somebody a representative from one of those benefits providers and maybe they're not familiar with cal able accounts we see that a lot with organizations that have a lot of turnover um we do try we do presentations to social security um it's medical to try to get the word out but you know sometimes people just aren't aware of cal able accounts and it really goes against everything people have been told about social security and benefits You know, the ability to save money and improve, you know, quality of life. And so the letters on our website are a really great way you can share them with representatives and they are from the agencies themselves. And so those are the guides that the representatives at the agencies have to follow.

LC:
And that's, yeah, that's something that we try to bring up to parents and we try to put in our articles about whatever programs or supports that we're looking at in the state. Because like you said, there can be a lot of turnover, there can be new people. So when you have those letters on hand, it's just helpful. Julia asked, if the owner of CalABLE passes, do the remaining funds go to any listed beneficiaries? What happens to it?

MH:
Yes, yes, this is definitely one of our most commonly asked questions. And so with the CalABLE account, there is the ability to list a successor designated beneficiary. This does have to be an ABLE eligible sibling of the current beneficiary. And so if you do have an ABLE eligible sibling, you can list them on the account as a successor designated beneficiary. And then when the account owner passes away, the account will just be transferred to the successor. But many people don't have an ABLE eligible sibling. So in that case, what happens is the executor of the estate will submit a death of beneficiary form to CalABLE, and then the account will be locked. And then the money in the account can be used to pay any outstanding qualified disability expenses or even burial and funeral expenses. And then the account, the applicable taxes will apply, and then the money will go into the beneficiary's estate, and the executor of the estate can direct it however it is listed out there.

LC:
Okay, and I'm not sure. I think this is, Nancy had a question that was similar, and I'm not sure if it's the same question, so... You tell me. It might be a little different. She said, can a minor get survivor benefits for a parent passing away and SSI due to a disability? Or can you only get one? I'm confused.

MH: I am not sure the answer to that question. That is something for SSI or Social Security.

LC:
Right. Okay. Yeah. Nancy, don't worry. I'm confused as well about all of that, about how everything like plays nicely together. Right. It's so hard to know, you know, OK, who whose responsibility is it? What's happening? It's it's it's very complicated how everything plays together. But yeah. But like Madeline said, that's something definitely to reach out to to SSI about. And then, Madeline, I you know, Is there any reason, any situation where a family or individual should not consider starting a CalABLE account?

MH:
Hmm. It's a good question. You know, I would say that, you know, there are some fees that, you know, that the CalABLE account has. And so we recommend you have to have $25 to open the account. But we encourage people to be continuously contributing to the account to help offset those fees. So maybe if you don't have the ability to keep contributing to the account right now, you could maybe want to wait so that your money isn't drained by the fees. So that could be one reason you might want to wait. But really, I think CalABLE accounts are really a fantastic option. And, you know, they are open nationally. So even if you're planning on moving out of California, you could still keep your CalABLE account. So, yeah, we definitely encourage everybody to open accounts and begin saving and growing money.

LC:
Can I ask you, Madeline? So if you have a CalABLE account, whether you don't live in California or whether you do, you decide to move, does it change any of the rights or the restrictions around that account if you are not a resident of California?

MH:
Um, not really. So the only thing is the Medi-Cal recovery. Um, so with the CalABLE account, the accounts are protected from Medi-Cal recovery for California residents. And so if you were to move to a different state, um, they would have a different Medicaid program. Um, and so you might want to look at the ABLE program in that state to see if they have protections against Medicaid recovery.

LC: Okay. Yeah. Great point. And I mean, what is, you brought up many, but what is the most important thing that you really want families to walk away with today?

MH:
I think the main thing is that, you know, these accounts, they are used to achieve a better life experience. The money grows tax-free. I think that is a key benefit. And it really allows people to live their best quality of life while saving money and still being on benefits. So we wanna encourage everybody to get started right away, begin saving that money. The sooner you start saving, the more you can save in the end.

LC:
Yes. Thank you so much, Madeline. I'm sure we could talk for... I know after I digest a lot of what you said, like I'm sure a lot of people, a lot more questions will come to my mind. I mean, and I think CalABLE can be a particularly intimidating subject for families. And especially when it feels like our funds are barely stretching where we need to go today. So it's something that can be easy to disregard or put off. Like, I'm just going to think about that another day. But the way that you laid it out, it becomes a lot less intimidating to think about or to plan. And there are so many advantages which you really brought to life. So thank you.

And also, I have to say, it feels like we have some really strong options for funding when you think about various programs like CalABLE and the self-determination program. I mean, it opens things up. So like you were saying, it goes against everything that we're taught from the beginning, right? There's this $2,000 asset limit, which is this terrifying thought, like, how is my child? when they grow up, how are they, for many of us whose children might have some, you know, restrictions on what work can look like or how much, you know, that can be bringing in for them. I mean, it's a terrifying thought, right? The future could be really scary. And so this makes it you know a little less scary so you know thank you thank you so much and I was thinking when you were talking about otto I loved like you know the shout out to otto like be like otto right jump in let's all become financial enthusiasts for our children no matter how scary it is right and then you know if we're lucky then you know you can have a a child like otto who really gets excited and then takes the reins himself which you know but that that was that was really uh it was cool I i loved I loved hearing all of the stories so thank you so much and And like I said, I know I'll have questions. I'm sure some of you listening will have more questions.

Again, we encourage you to visit the CalABLE website. They have pages and pages of common questions along with answers. It is, like Madeline said, a wealth of information in plain language, which is so appreciated. And Donna is also going to share the link. I think she already shared the link for the slides in the chat today. So you have that handy. And as with all of our training series, we encourage you to use this recording as a starting point and to take it one step at a time. We know how overwhelming things can get.

If you do want or need one to one support or someone to walk through the process with you, our undivided navigators are ready to create a roadmap with you and for you. Donna will share the Undivided Kickstart link in the chat. Our Kickstarts are free. You can work with a navigator and understand more about how the Undivided platform can support you exactly where you are. Whether you need help with CalABLE, IEPs, or insurance claims, we've got you covered. And if you aren't already in our Parents Only Facebook group, we would love to meet you and say hi. You can also follow us on Instagram, Twitter, YouTube, and LinkedIn. Donna will share those links in the chat. Thank you again to Madeline and to all of you. Our mission is to support you so your children can thrive, and we want you to thrive too. Happy summer. We'll see you soon. Bye.