As the parent of a special needs child, you probably devote considerable time and attention to ensuring that your child has everything he or she needs with regard to health care, money, education and so on.
As a special needs parent, there are also certain steps you can take when it comes to estate planning for your special needs child, and these steps may differ broadly from those faced by other adults.
Currently, per USA Today, more than 56 million Americans are living with some type of disability, and if your child is one of them, you may want to consider creating a special needs trust.
Understanding the special needs trust
A special needs trust is something you can create with your disabled child’s specific needs in mind, whether medical, educational or what have you.
A trust must have a trustee, or someone who manages the trust, and it gives you an opportunity to leave assets to your special needs child without having to worry about those assets disqualifying your child from receiving public assistance.
How? Most government benefits, such as Medicaid or Supplemental Security Income, are income-based, which means that, should you leave your disabled child money in a will, rather than a trust, it may affect your child’s eligibility for critical public assistance. By placing assets in a special needs trust, however, you can rest comfortably knowing these assets will not factor in when determining whether your child qualifies for public benefits.
Funding the special needs trust
Just how can you fund your special needs trust? You can arrange it so that any real estate you own after your passing goes into the trust, or you can also fund it using your retirement accounts or life insurance policies.
While every family situation is unique, if you are a parent of a disabled child, you may want to devote some serious consideration to establishing a special needs trust.