Retired United States Air Force veteran with a Bachelor's in Finance and Account Management. ABLE funds are being saved for housing expenses.
Nathaniel Dykstra’s Highlight from the November 2019 AchievABLE Newsletter
Nathaniel Dykstra is a 30-year-old ABLE account owner living in Chandler, Arizona, who opened his account with his home state of Michigan through their MiABLE program. Nathaniel is eligible for ABLE due to Rheumatoid Arthritis, which developed when he was 23 years old and stationed with the U.S. Air Force in Minot AFB, North Dakota. As a result, he was medically retired from the military with a 100 percent disability rating from the Veterans Administration (VA). He receives full disability benefits from the VA.
Nathaniel has a Bachelor of Science degree in Finance and Accounting Management, which he says, combined with his experience with his disability, gives him an excellent grasp of the investment needs and opportunities of ABLE account owners. “I started using the ABLE NRC website shortly after the first states started offering ABLE accounts, looking for when a state would offer a program that met my needs. I used the ABLE NRC’s State ABLE Program Comparison Tools to review the account limits, investment options and fees of the different states. I used the links to get to the program websites to read prospectuses [aka the State’s Disclosure Documents]. In the future, I will be using the ABLE NRC website to get details on qualified expenses when I’m ready to start withdrawing from my account.”
Speaking of Qualified Disability Expenses (QDEs), the electric bike that Nathaniel recently purchased would have been covered as a QDE from his ABLE account. The bike adds significantly to his quality of life. It helps Nathaniel get exercise on his good days in a way that accommodates his disability while providing a great transportation alternative to his car. He says he’s amazed at how much he goes out now and attributes this to the safety of an electric motor to help him get home if he doesn’t have the strength to pedal. Nathaniel uses the electric-assist cargo bike to get groceries and carry other items. It also helps with his circulation and building muscle mass, and he’s able to bike without using knee braces since he doesn’t have to use as much force to propel this bike. Nathaniel uses the bike more than his car now.
However, despite it being a QDE, Nathaniel went ahead and purchased his electric bike out-of-pocket. Nathaniel’s strategy works for him since he solely receives VA benefits with no other means-tested benefits and was able to save enough to do so. When asked, “Why didn’t you use your ABLE account funds to purchase your electric bike if it would be a QDE?” Nathaniel answered, “Because I want to maximize my long-term wealth building in a tax-advantaged account.”
Nathaniel is working on maxing out contributions into his ABLE account without pulling any money out for as long as possible, which supports his long-term ABLE goal. He opened his ABLE account because he wanted to have a tax-advantaged way to save for future housing expenses. “I like living in an apartment since I can’t handle interior or exterior maintenance, but that means I can’t own the place. I want to build a large enough fund that will pay my rent, including future rent increases, at a sustainable withdrawal rate. If I get married in the future, an ABLE account will also allow me to cash it out to purchase a house or condo.”