When it comes to the well-being of their children, parents will do just about anything. That includes venturing into the very scary subject of planning for their own deaths. And no, not in a morbid sort of way. The sort of estate plans that readers of our blog hear so frequently about such as naming a guardian, adding beneficiaries to a will, or instructing family members about medical wishes.
But one thing we haven’t covered much on is about how parents with disabled children should plan for the future. While in some cases Social Security Disability benefits and Supplemental Security Income can provide a source of income, in most cases, children with special needs often rely on their parents to provide them with financial support. So what happens when those parents pass away?
If you’re a parent with a special needs child, one important way to make sure that they have financial stability is to establish a special needs trust. It’s worth noting that these types of trusts are not easily done without help from a skilled attorney. That’s because these types of trusts, while flexible in nature, can interfere with benefits received through government assistance programs. If not worded properly, a trust can quickly disqualify a disabled child’s benefits, leaving them in the exact financial crisis you tried to prevent.
Speaking to a lawyer is the first step to establishing the trust. But what about funding? How much money should you set aside? How much of those funds will be distributed at each time? These are all important things to speak to your attorney about because the answer will differ depending on your particular situation.
To someone unfamiliar with estate planning, establishing a special needs trust can seem like an overwhelming process. But this is where your attorney comes in. They can help you understand the complexities of the law and help you prepare financial stability for your special needs child after you’ve passed away.
Source: The Fiscal Times, “Estate Planning Guide for a Special Needs Child,” Sonya Stinson, July 10, 2013