If you count yourself among the one in 20 families who are raising a child with a disability, you know that life can be financially and emotionally challenging. Perhaps the most distressing questions you ask yourself are, ?Who will care for my child when I pass away and how much will it cost?? Many folks do not know where to start: 68 percent of those caring for someone with a special need are unfamiliar with how to set up a trust to preserve eligibility for programs such as Medicaid and/or Supplemental Security Income (SSI), benefits that may be needed now or in the future.
Whether your child is diagnosed with cerebral palsy, experienced a brain or spinal cord injury, is on the autism spectrum, or has another type of disabling condition, there are strategies to assist with achieving the goal of ensuring your beloved son, daughter or other relative will be cared for in the future. Below are five tips for planning for your loved one.
1. Work with Professionals. It is critical to seek out professionals who specifically focus on planning considerations for individuals with disabilities. This type of planning takes a team of professionals working together to learn about your family?s needs and develop a customized plan that is right for all parties involved. The sooner you begin thinking about your child?s financial future ? and your own ? the more time you will have to save and prepare.
2. Identify the best trust for your situation. Special Needs Trusts (SNTs) are ideal for parents who want to ensure their child will be eligible now or in the future for federal and state benefit programs such as Medicaid and/or SSI. Additionally, a well-crafted SNT will address many of the care considerations parents have regarding their children after they are gone. Although there are different kinds of SNTs, they share the common goal of helping a person maintain eligibility for the benefit programs mentioned above. Whether your child recovers money from a lawsuit, receives an inheritance from a deceased loved one or receives assets from family members, a trust solution exists to best accommodate your situation. Ask your advisor which type of trust is best suited for your family.
3. Determine the right trustee. One of the most important decisions you will make is choosing the right trustee to administer your child?s trust. There are several different options, and your advisor should help you weigh these choices so that you can make the best decision for your situation. These range from a corporate trustee such as a bank to a family member or nonprofit organization. One approach is to name several trustees or add family members as ?trust protectors? which ensures that people who understand the situation firsthand are involved in personal care decisions related to the trust beneficiary. This option also builds additional accountability into the trust, giving parents greater confidence in their child?s care.?
4. Update legal documents. An attorney who specializes in elder care and special needs law should be consulted to review and update your last will and testament and any other legal documents in order to reflect your child?s needs. After reviewing your overall plan, the attorney may recommend additional documents like a binding description of your guardianship wishes, a durable power of attorney for health care and a durable power of attorney for financial affairs.?
5. Remember your retirement. While meeting your child?s current needs can be financially challenging, it is also important to save aggressively to ensure you have a stable retirement plan for yourself. This way, you can accumulate the assets necessary so that caring for your child after you?ve retired will be more gratifying and less stressful. We?ve seen many families over the years struggle to find that balance. Recently, Patrick Storey, a student at Performing Arts Studio West who has autism participated in a SunTrust Bank commercial about this type of planning. The subject matter resonated with Patrick?s family, and in this three minute behind-the-scenes video, Patrick?s dad shares his family?s experience.
Bill Frazier is a senior vice president at SunTrust Bank and oversees a unique, national division of trust and estate professionals who serve the financial needs of people who have been injured and families who have loved ones with disabilities.
SunTrust Bank and its affiliates and the directors, officers, employees and agents of SunTrust Bank and its affiliates (collectively, ?SunTrust?) are not permitted to give legal or tax advice. While SunTrust can assist clients in the areas of estate and financial planning, only an attorney can draft legal documents, provide legal services and give legal advice. Clients of SunTrust should consult with their legal and tax advisors prior to entering into any financial transaction or estate plan. Because it cannot provide legal services or give legal advice, SunTrust?s services or advice relating to ?estate planning? or ?wealth transfer planning? are limited to (i) financial planning, multigenerational wealth planning, investment strategy, (ii) management of trust assets, investment management and trust administration, and (iii) working with the client?s legal and tax advisors in the implementation of an estate plan.
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