State Treasurer Colleen Davis Marks #ABLEtoSave Month

Campaign comes on the heels of record setting effort

To encourage people with disabilities to save for their futures, State Treasurer Colleen Davis is recognizing August as #ABLEtoSave Month, an effort to educate people with disabilities about the importance of opening ABLE (Achieving a Better Life Experience) accounts.

ABLE accounts are tax-advantaged savings accounts that allow individuals with disabilities to save for a broad range of expenses without jeopardizing their benefits from supplemental security income (SSI), Medicaid and other federal or state programs.

The primary goals of #ABLEtoSave are to increase awareness about ABLE accounts and to accelerate the amount of ABLE accounts opened in Delaware and across the country.

“There is no limit on what people with disabilities can do, so there’s no reason their ability to save should be limited,” said Treasurer Davis. “Since the creation of DEpendABLE, Delaware’s own ABLE program two years ago, some of the state’s most vulnerable citizens have gotten some security for tomorrow without affecting the services they need today.”

Just last month, nine new DEpendABLE accounts were opened, the highest one-month total since the plan began. To date, there are 95 funded DEpendABLE accounts representing $817,000 in total assets.

“We’re going to do everything we can to inform plan participants about ways to save and educate those who haven’t opened an account as to why they should during #ABLEtoSave Month,” Davis said. “Our goal is to have 100 DEpendABLE accounts by the end of the campaign.”

“Putting aside money for the future can be difficult for anyone, but especially for people with disabilities. That’s why I co-sponsored the Delaware ABLE Act, which today is helping some of our most vulnerable residents build a savings account without jeopardizing their disability benefits,” said Senate Majority Leader Nicole Poore (D – New Castle). “Best of all, Delaware allows friends and family to contribute to those accounts as well. If you’re the parent of a child with disabilities, I strongly encourage you to help them build some financial security and give yourself some peace of mind by opening an ABLE account today.”

“A disability should never preclude someone from enjoying a financially secure future,” said Sen. Trey Paradee (D – Dover). “But for our most vulnerable citizens, traditional savings accounts can put their disability benefits at risk. The DEpendABLE program offers a great solution that empowers our most vulnerable residents to make long-term planning decisions with the money they can put away in a tax-advantage account. Those funds also can be accessed for disability expenses, education and housing at any time without penalty. I encourage families to learn more about this powerful savings tool.”

“An ABLE account is a great resource for individuals with disabilities to save money for care they may need. I highly recommend those who qualify to check out the program and open an account,” said Senator Brian Pettyjohn (R – Georgetown).

“I know firsthand the complex financial challenges that confront families who have a loved one with special needs,” said State Representative Krista Griffith (D – Fairfax). “ABLE accounts can be a simple but powerful tool to help families address these challenges. And that’s why I opened an ABLE account for my son, Nate. I encourage Delawareans who have a disability or who are helping someone with a disability to explore the potential benefits of a Delaware ABLE account.”

State Rep. Kevin Hensley (R – Middletown) said, “As a co-sponsor of the original bill creating the ABLE accounts and as the father of an adult daughter with intellectual disabilities, I am a strong proponent of participation in this savings fund. In fact, my daughter, Jules, has set up our own ABLE account. If you or your family member is a person with disabilities, this is one of the best investments that can be made in your/their future.”

For more information about DEpendABLE, visit able.delaware.gov.


State Treasurer Urges Caution to Those Making Withdrawals From Retirement Funds

The economic impact of the coronavirus pandemic has many Delawareans, and people around the country, rethinking their savings plans, including saving for retirement. While “staying the course” is typically the safest way to maintain your position in an unstable market, sometimes changes are essential.

Speaking to the Chartered Financial Analyst (CFA) Society of Philadelphia, Delaware Treasurer Colleen Davis said help is available with provisions in the Coronavirus Aid, Relief, and Economic Security (CARES) Act allowing people who need cash to get it without typical fees and penalties.

The CARES Act allows for those affected by coronavirus who may need additional funds from their retirement plans to get disbursements of up to $100 thousand during the current calendar year (through December 30th, 2020).

“As people are going through these extremely difficult times, this is a little bit of a fail-safe for them, and it does make it so they’re able to access funds that would have been much more difficult to access,” Treasurer Davis said. “At the same time, these plans are meant for saving for the future and I caution that we’re not doing a knee jerk response and withdrawing funds that we think we’re going to need but don’t necessarily know for sure that we’ll need a large distribution. It’s important to work with your plan administrator to find the best options.”

Treasurer Davis noted the Internal Revenue Service (IRS) just announced the coronavirus-related distributions (CRDs) are not subject to the typical 10% penalty for withdrawals made prior to age 59 ½, and though they are still subject to income tax, those taxes can be paid over a three-year period, Additionally, taxpayers that take the CRDs will have three years to repay their plans.

The CARES Act defines a qualifying person as:

  • Having tested positive and been diagnosed with COVID-19
  • Having a dependent or spouse who has tested positive and been diagnosed with COVID-19
  • Experiencing financial hardship due to them, their spouse or a member of their household:
    • Being quarantined, furloughed or laid off or having reduced work hours
    • Being unable to work due to lack of childcare
    • Closing or reducing hours of a business that they own or operate
    • Having pay or self-employment income reduced
    • Having a job offer rescinded or start date for a job delayed

“While I want people to save for the future and to continue to invest in themselves and for their retirement, I also understand how critical it can be for so many families to make these withdrawals,” Davis said.


Treasurer Davis Says Now is the Time to Review Savings Plans

Online tool can identify available funds to be used in state plans

Dealing with a troubled economy during the coronavirus pandemic has changed the way many people deal with their household budgets. The U.S. Bureau of Labor Statistics says Americans have been spending more money on groceries and home entertainment and less on travel and eating out. Changes in spending often lead to changes in saving, and State Treasurer Colleen Davis wants to remind Delawareans of the importance of saving money, especially when our economic future is unclear.

“While it’s important to maintain a healthy life and lifestyle, it’s essential that there’s money available for the future, especially if the nation’s health crisis continues,” said Treasurer Davis. “The Delaware Available Income Calculator is a tool helps determine how much available income you have to save or spend.”

Available on the State Treasurer’s website, the calculator takes your income and breaks it down by taxes paid and average biweekly expenses to show you how much of your paycheck can be saved or invested in desirable outcomes.

If saving for higher education is a priority, some of the amount identified by the calculator can be invested in a Delaware 529 account. Sponsored by the State, the plan provides a way for parents, grandparents and others pay for education expenses without having to pay taxes on the money as it grows.

The State also offers DEpendABLE, a low cost 529(a) savings plan for people with special needs, allowing them and their families to save money for qualified living expenses without jeopardizing their social security or Medicaid benefits.

“Knowing your options and availability of extra money is more important than ever right now,” Treasurer Davis said. “The only thing certain about the economy in the near future is that it’s uncertain.”


Treasurer Davis Interview Highlights Settlement to Help Teachers Retirement Investments

AAA bond rating, income calculator, and ABLE plan also featured

Delaware teachers misled by bad advice from a former vendor of retirement services now have options regarding their savings.
Delaware State Treasurer Colleen Davis spoke with Jeffrey Snyder of the Broadcast Retirement Network to discuss the settlement between the State and broker Horace Mann.

In 2016, in order to help educators get similar pricing and services that other State employees receive in their retirement plans, Delaware transitioned from a multi-vendor format, to a single vendor. The State selected Voya financial as its record keeper for the 403(b) plan as well as its 457(b) and 401(a) plans.

After the change, a Horace Mann representative, Dieter Hofmann provided customers with inaccurate or misleading information regarding the change to a sole vendor. Hoffman allegedly advised many of his 403(b) clients to stop their contributions to the 403(b) program and instead buy into Horace Mann individual retirement accounts (IRA).

Financial Operations Program Manager Dan Kimmel and Investment and Operations Manager Michael Green led the effort for the Office of the State Treasurer, with the Delaware Department of Justice investigating and reaching the settlement.

You can see Treasurer Davis’s entire interview in which she also discusses the State maintaining its AAA bond rating, and a tax-advantaged way for individuals with disabilities, and their families, to save money for disability-related expenses at BRN AM.


Treasurer Davis Shares Important Lesson with Third Graders

Delaware State Treasurer Colleen Davis recently went to Lord Baltimore Elementary School in Ocean View to read to a group of third grade students and teach them a valuable lesson about leadership.

The book Treasurer Davis read, Grace Goes to Washington, the sequel to Grace for President, tells a story about a girl who takes a field trip to Washington, DC with her class. Exploring government buildings and national monuments, Grace feels closer than ever to her dream of becoming president someday. But she and her classmates have a lot to learn about what it means to serve the needs of the people, especially when the people want different things! Hearing the story of Grace and meeting Treasurer Davis put women’s leadership in the spotlight.

“The ability to get out into the community is one of the best parts of public service,” Treasurer Davis said. “I love the chance to talk to our children and remind them they can become anything they dream of. I’m so grateful Mrs. Yuhanick, her students, and Principal Webb for the opportunity.”

Grace Goes to Washington, written by Kelly DiPucchio with illustrations by LeUyen Pham, also provides an easily understandable overview of the three branches of government, illustrates checks and balances in an accessible and fun way, highlights girls and women in public leadership, and teaches elementary-age children the value of kindness, courage, and independent thought.

The book, published by Disney-Hyperion, was made available to women lawmakers and other elected officials across the country by Teach a Girl to Lead®, a program of the non-partisan Center for American Women and Politics (CAWP), a unit of the Eagleton Institute of Politics at Rutgers University. Support for distributing the book came from the Hess Foundation, The Honorable Constance Hess Williams, and Comcast NBCUniversal. After reading the story to children, Treasurer Davis donated her copy to the school.

CAWP created Teach a Girl to Lead® to inspire girls and young women to follow in the footsteps of women leaders, past and present. Making women’s political leadership visible to America’s youth will help both boys and girls grow up with more inclusive ideas about who can lead.