It’s common for parents to be concerned about their children’s futures when they have unique healthcare needs or disabilities. But you can ensure a comfortable life for you and your child. Here are some advice on creating a financial plan for your special needs child.
- What will my child’s ideal way of life be, and where will he or she desire to go?
- How can I ensure that living expenses (such as rent and transportation) are paid if my child is unable to work?
- How can I save for my child’s future without jeopardizing his or her eligibility for government benefits?
These questions could keep you awake at night. There are some who believe that creating a strategy might help alleviate stress. Step one: Determine your child’s long-term financial goals. Others are easy, some are difficult, and some involve legal expenses; some are free and some are expensive. The sooner you can get started on some of these, the better.
Set up a Trust for People with Special Needs
A long-term financial strategy for your child’s special needs should include the creation of a special needs trust. This is where you can deposit money that you save, money that others donate to your child as presents, and money that you earn from insurance settlements. Your child’s eligibility for Medicaid and Supplemental Security Income will not be affected by this trust (SSI).
A Will should be drawn out.
When you die, your assets are dispersed according to your will. Writing a will ensures that your assets do not end up in the hands of your child and instead go to a special needs trust. Unless you have a will, a probate court judge can name your child a beneficiary and disqualify him or her from receiving federal assistance (see above). You can also name a guardian for your children in your will.
You should not set up a will for a disabled child on your own.. Consider hiring a disability lawyer who is familiar with your state’s disability laws. Give a copy to each of the executors or guardians designated in the will and have your lawyer preserve a copy. The Special Needs Alliance or the Academy of Special Needs Planners can put you in touch with an attorney in your area.
Choose a Protector
A guardian will take care of your children if you die before they reach adulthood. When making this decision, take into account how much time you spend caring for your child. Who is capable of making such a long-term commitment? Do you know who has formed a close relationship with your child? Do you know someone who has the tolerance, understanding, and other character attributes necessary to handle the day-to-day responsibilities of parenting a child?
Once you’ve decided on a candidate, inquire as to whether or not he or she is up to the task (even though you hope it will never be necessary). Additionally, it’s a good idea to talk about how this commitment will likely last beyond the age of 18.
Select a Managing Trustee
After your death, your special needs trust will be managed by a trustee. Anyone from a trusted acquaintance to the CEO of an investment bank or legal firm can serve as an executor. If you have a trust fund for your disabled kid, the trustee will make sure that the funds are only used for the services you specify or that are necessary for your child’s needs.
This includes ensuring that the trust’s money is invested wisely. The guardian of your child cannot spend any money from the trust without the trustee’s permission.
Building a Saving
Treatments and therapies that are needed for special-needs students may not be provided by their school or covered by their insurance simply because they are needed. Personal savings are critical at this point. Get started by putting aside whatever money you can each month, no matter how tiny. Make sure you don’t place this money in the name of your child.
Request a referral from other parents of children with special healthcare needs or contact your local school system to find an advocate in your region. You might also get in touch with organizations that cater to the special needs of your child or institutions in your area that have special programs for disabled students.
Prepare a Letter of Intent
The financial future of your child must be planned for. However, ensuring that your child’s basic necessities are taken care of in the event of your death is equally important. A Letter of Intent can help with this. Set up a list of your child’s medical providers and their contact information, along with current medications and dosages. Are there persons or activities that you don’t want your child to be around? Make a note of that as well.
Update the letter once a year. A legal document is not required, therefore you can write one yourself. Make a copy and store it with your other wills. Moreover, make sure a copy is sent to your child’s designated guardian.
Educate All Members of the Family
If you’re in need of financial assistance, family members such as grandparents, aunts, uncles, and cousins may be willing to pitch in. Tell them, though, that putting anything in your child’s name is a big no-no. Grandpa can’t leave anything to your child in his will or designate your child as a beneficiary on his life insurance policy, so have a family gathering to explain why this is the case. Nothing should ever be given to your child in the form of savings bonds, stocks, or cash.
Those close to you have the option of leaving a legacy for your child. To make sure your child doesn’t inherit anything, have them make a bequest to an ABLE account in the name of the special needs trust.
Meaningful articles you might like: Special Education Techniques For All Children, Getting to Know the Special Needs System for Children, The Rise of the Stay-at-Home High School Parent