Planning for a special needs child or family member can overwhelm even the most detail-oriented parent. This is made especially difficult because you often have to juggle the child’s current emotional, academic, and social needs while planning the long-term financial needs for their future. Here are just a few things that you should be focusing on in the planning process:

SIT DOWN WITH A PROFESSIONAL

One of the most important professionals you should look to meet with is an estate planning attorney. (Keep in mind I said an estate planning attorney: everyone seems to have a lawyer in the family, but they may not know what they are doing) An estate planning attorney (better yet, a special needs attorney) will most likely recommend you look to set up a Special Needs Trust. Basically, this document creates a bucket that can be filled with some of your existing assets, life insurance proceeds, etc. so that you can fund your child’s future needs. This Trust should also provide for protection of those assets from any creditors or legal proceedings that could happen.

ENTITLEMENT PROGRAMS AND HOW THEY FIT INTO THE PICTURE

Social Security and Medicaid are two important programs that are vital to your dependent’s long-term success. If too much money or income are left to the child, then the government will effectively freeze their benefits, and they will run into a spend-down situation in order to reapply for these services. Essentially, the child would have to “spend down” their excess resources to $2,000. Also, they are entitled to education services from ages 3 to 22, which will continue to adjust as they age. Working together with an attorney and a financial planner can actually help smooth out the flow of these services for your child.

GUARDIANSHIP

Will my child need a guardian?

Who should I appoint?

How do I appoint them, and what powers should be granted?

Decisions will need to be made before your child turns 18, because at that age, they are legally considered an adult. This can be a long and expensive process, and a competent estate planning attorney with a special needs focus can help you look at the effects of this decision.

DON’T FORGET TO PLAN FOR YOUR OWN FUTURE!

While planning for the needs and care of your child can be difficult, you shouldn’t leave out your own retirement needs. Your planning will focus on your own retirement years, how you’ll get there, and how your estate will distribute those assets to continue the level of care for that child.

The most important thing to keep in mind when planning for a dependent with special needs is the quality of life for everyone in the family. Setting and evaluating your financial goals on a regular basis can add structure to what may feel like a chaotic but rewarding life. We take a comprehensive approach to financial planning where we take the time to understand your individual circumstances so that we can assist you in your planning. Start planning smart, and stop being the government’s personal piggy bank.