Estate planning can be complicated enough, but add in the need to plan for your special needs child's care for when you're gone, and you've added a whole other layer of complexity. If you have a special needs child and are worried about how they'll be provided for, consider setting up a special needs trust. The three most important steps are outlined below.
Learn About Your Options
A special needs fund is a fund that will hold the money for your child in the event of your death. Your child won't have possession or control of the assets in the fund, which means they can still receive their disability payments and Medicaid health insurance.
While most anyone can set up a special needs fund on their own, working with an estate attorney (like those at Begley Carlin & Mandio LLP) and financial advisor can certainly make the task easier. There is a lot that needs to be considered when setting up a fund, such as taxes and inflation of living expenses, and having expert help on your side can make sure everything is set up correctly. There are also a number of ways the fund can be set up, and it's best to talk these options over with a professional in the field. Another person you'll need on your team is a trustee.
Find a Willing and Trustworthy Trustee
The trustee of a trust fund handles the disbursement of the funds, and for funds that aren't earmarked for specific expenses, helps your special needs child to make wise decisions.
While choosing a family member or close family friend isn't always possible, it's the best way to go. While professional companies do exist to help to manage your child's funds, they don't have the same insight into your child's needs as a loved one. Choosing someone who has your child's best interests at heart can go a long way in helping you to rest easy, knowing your child will be well provided for.
Figure Out Funding
Determining how much to put into the trust can be tricky, which is why the help of a financial advisor or experienced estate attorney is vital.
If funds are limited, remember that your child can still receive their disability checks, even with a trust fund in place. It is important to consider, however, potential increases in costs of living. If your child lives in an assisted living facility, what they're paying for residence now will not remain the same throughout the years. This goes for other necessities as well, such as transportation, clothing, and personal care products. It's also important to consider the taxes that will be owed on the trust fund so that your child and the trustee don't have to worry about them.
With the help of an experienced estate attorney, you can set up a special needs fund that will provide for your child for the rest of their lives. Working with an attorney will help you to choose from all of the options available to you and give you the resources you need to make the right decision. For more information on setting up a trust fund, make a consultation appointment with an attorney today.Share