More Families Now Qualify for ABLE Accounts. Here Is Why That Matters When You File the FAFSA.

If your family includes someone with a disability, a rule change that took effect on January 1, 2026 may have quietly opened a savings account you did not have access to before. It is called an ABLE account, and the short version is this: money saved there does not count against you when a college fills out your financial aid picture. That matters right now, because the 2027-28 FAFSA opens on October 1, 2026, just two weeks from now, and families are already gathering the account numbers and balances the form will ask for.

Here is what changed, who qualifies now that did not before, and why this particular account deserves a spot in your college planning even if you have never heard of it.

What changed: the ABLE Age Adjustment Act

For nearly a decade, ABLE accounts were only open to people whose disability began before their 26th birthday. That single rule shut out a huge number of people who were disabled by a car accident, an illness, a stroke, or a service-related injury later in life, even if their day-to-day needs looked identical to someone who qualified.

The ABLE Age Adjustment Act, part of the SECURE 2.0 Act, changed that. As of January 1, 2026, the age of onset requirement moved from before age 26 to before age 46. The Social Security Administration and the ABLE National Resource Center estimate this makes roughly 6 million more Americans eligible, including about 1 million more veterans with disabilities than could open an account before.

This is not a new benefit that got announced this month. It is a rule that has been in effect for about nine months as of this writing. What makes it worth covering now is timing: this is the first FAFSA season where a much larger group of families will be filling out the form while already holding, or seriously considering, an ABLE account.

Who qualifies now

To open an ABLE account, a person still needs to meet the Social Security Administration's disability standard: a significant, long-term disability, generally one expected to last at least a year or that is terminal, that causes marked and severe functional limitations. What changed is only the age window for when that disability had to begin.

In practical terms:

• Anyone already receiving SSI or SSDI based on a disability that began before age 46 qualifies automatically.
• Someone who is not on SSI or SSDI can still qualify by having a physician certify the disability and its age of onset.
• The disability does not have to be visible or a single diagnosis. Conditions like autism, a traumatic brain injury from a car accident at 30, a psychiatric disability, or a progressive illness diagnosed at 40 can all fit, depending on severity and documentation.

If you have a family member whose disability started after age 26 but before 46, and you assumed ABLE accounts were not an option, it is worth checking again. A lot of families stopped looking years ago and never revisited it.

Consider a student who was in a serious car accident at 30 and now lives with a permanent mobility impairment, or a parent whose multiple sclerosis was diagnosed at 38. Neither could have opened an ABLE account under the old rule. Both can now, and either one could be paying for or supporting a college student today.

Why this matters when you file the FAFSA

Here is the part that connects this to college costs directly. The 2026-2027 Federal Student Aid Handbook is explicit about how ABLE accounts are treated: "An ABLE account is a tax-advantaged savings account for a disabled person and their family; its value does not count as an asset on the FAFSA form."

That is a complete exclusion, not a partial one and not a cap. Compare that to how the FAFSA treats other common savings vehicles:

• A 529 college savings plan owned by a parent or the student counts as a reportable investment asset.
• A Coverdell education savings account counts the same way.
• A regular savings or brokerage account in a parent's or student's name counts.
• An ABLE account does not count at all, no matter the balance.

For a family trying to save for a disabled child's future, including future education costs, that is a meaningful difference. Money sitting in a 529 plan can raise the Student Aid Index and shrink a financial aid offer. The same dollars sitting in an ABLE account, used for the same eventual purpose, do not touch that number.

This protection is on top of the protections ABLE accounts already offer outside of college aid. Up to $100,000 in an ABLE account does not count against the $2,000 resource limit for Supplemental Security Income, and the full balance is protected from Medicaid's asset test in most cases. The FAFSA treatment is simply one more layer of the same idea: this money is meant to support a person with a disability without punishing them for having it.

A word of caution on state and school aid

The FAFSA rule is federal and it is clear. Individual colleges that use their own institutional aid formulas, or state grant programs with their own asset questions, do not automatically follow the same rule. If a school's aid office asks about assets separately from the FAFSA, ask directly whether ABLE accounts are excluded from their formula too. Most follow the federal standard, but it is worth a two-minute phone call rather than an assumption.

What this money can actually pay for

ABLE accounts are not limited to medical bills. The IRS defines "qualified disability expenses" broadly, and college costs fit squarely inside that definition. Money in the account can go toward:

• Tuition, fees, and required course materials at a college, university, or vocational program
• Room and board, whether on campus or off
• Transportation, including a vehicle modification or the cost of getting to and from campus
• Assistive technology, tutoring, or accommodations not otherwise covered by the school
• Job training and career development, including programs that lead directly into employment

Because the list is this wide, a family can use one account to cover both everyday disability-related costs and college costs, without having to justify a strict line between the two.

How much you can actually save

The standard ABLE contribution limit tracks the federal annual gift tax exclusion, which is $19,000 per person for 2026. That is the most any single account can receive across all contributors in a calendar year, whether it comes from the account owner, parents, grandparents, or anyone else pitching in.

There is a second way to save more, called ABLE to Work. If the account owner has a job and neither they nor their employer is contributing to a workplace retirement plan that year, they can contribute additional money from their own earnings, up to the federal poverty guideline for a one-person household. For 2026, that guideline is $15,960 in the continental United States. That means a working account owner could potentially set aside close to $35,000 in a single year between the standard limit and their own ABLE to Work contribution, though the exact amount depends on how much they actually earned.

A few other details worth knowing:

• Total balances above $100,000 can start to affect SSI, though Medicaid protection continues regardless of balance in most states.
• Growth inside the account is tax-free, and withdrawals are tax-free as long as the money goes toward a qualified disability expense.
• Qualified disability expenses are defined broadly and include education, housing, transportation, job training, assistive technology, and health care, so college costs fit comfortably within that list.

Moving money from a 529 plan into an ABLE account

If your family already has a 529 plan for a child who later became eligible for an ABLE account, whether through the original under-26 rule or the new age-46 expansion, you may be able to roll those 529 funds into the ABLE account without triggering taxes or a penalty. This rollover option, once scheduled to expire, has been extended and is available now. The rolled-over amount still counts toward that year's annual ABLE contribution limit, so timing a large rollover may take some planning with a tax advisor or the ABLE program in your state.

What to do before October 1

The 2027-28 FAFSA opens October 1, 2026, and asset balances as of the day you file are what get reported. Here is a short list to work through before then.

1. Check eligibility now if age was the barrier. If a family member's disability began between ages 26 and 46 and you were told before 2026 that they did not qualify, check again. The rule has changed.
2. Open the account early if you plan to use one. ABLE accounts are run by states, and most accept applicants from any state, not just their own. A quick search for "ABLE account" plus your state name will get you to the right program, or the ABLE National Resource Center keeps a directory of every state's plan.
3. Know which number goes on the FAFSA, and which does not. An ABLE account balance is not reported anywhere on the form. A 529 plan balance is. Keep those two numbers straight when you sit down to file.
4. Ask the school directly about institutional and state aid. A federal exclusion does not automatically carry over to every scholarship or state grant formula.
5. File the FAFSA as early as you reasonably can. Some state and institutional aid is awarded on a first-come basis, and an early file costs you nothing.

If you want to see what a school is likely to actually cost your family once financial aid is factored in, you can create a free CollegeLens plan and work from real numbers instead of guesses. And if you have not started the FAFSA checklist yet, our countdown checklist for the October 1 opening walks through everything else you need to gather.

Where families get tripped up

A few misunderstandings come up often enough that they are worth clearing up directly.

Does having an ABLE account replace the need to file the FAFSA? No. The FAFSA is still required for federal grants, work-study, and federal student loans. An ABLE account changes what counts as an asset. It does not remove the form.

Does the disability have to be the student's own? No. A parent, sibling, or the student can each be the person with the qualifying disability. What matters is whose name the account is in, since that is the person the account legally belongs to and the person whose disability determines eligibility.

Can someone have both a 529 plan and an ABLE account? Yes, and many families do. The two accounts serve different purposes and are not mutually exclusive. The rollover option described above is simply one way to move money between them if it makes sense for your situation.

Does opening an ABLE account affect financial aid the family already receives? Opening the account itself does not. What matters is the balance at the time you file the FAFSA and the balance the account holds going forward, since it stays excluded from the federal formula for as long as the money sits there.

The bottom line

A rule change that took effect at the start of this year quietly made ABLE accounts available to millions more families, and the accounts they can now open carry a real advantage that has nothing to do with taxes: the balance does not count against you on the FAFSA. If disability is part of your family's story, whether it began at age 4 or age 44, this is one of the few savings tools that lets you set money aside for the future without shrinking your financial aid offer at the same time.

It will not close a college affordability gap by itself. Sallie Mae's How America Pays for College 2026 survey found that families spent an average of $34,019 on college in the 2025-26 academic year. No single account changes that number on its own. What it can do is protect real savings from working against a family that is already stretched thin, and that is worth understanding before you file.

-- Sravani at CollegeLens