Q: How does having a special needs child affect wealth management and planning?
A: When there is a special needs child to consider, a family's wealth management plan, by necessity, becomes more risk averse. There is still the desire to find the best available investment opportunities and those providing the best tax shelters, but a primary focus has to be providing a sustainable quality of life for the special needs child. In the previous article on Special Needs Planning, I emphasized that a special needs child who is now or may become eligible for government health benefits should never be named directly as a beneficiary of their family’s wealth. Not directly, not ever. But, a well-developed estate plan can include a special needs trust in which to shelter funds and provide for the supplemental needs of the special needs child and their enhanced quality of life.
Every special needs child is different, but they typically have one thing in common - they may have to rely on government services at some time in their lives for the care they need in order to have a meaningful quality of life. Any direct inheritance to them which puts them over the allowable means-testing figure for those benefits (at this time, $2000) will make those services unavailable.
Wealth management strategies, intended for the benefit of a special needs child, requires not only the amassing of discretionary trust fund assets, but also the development of a strategy for creating a comprehensive special needs plan for the future health and welfare of the special needs child. This plan includes not only creating and funding a supplemental needs trust for the special needs child, but also, determining who can best manage the trust assets so that those assets can provide for the child's special needs for the duration of their life; choosing the best candidate to provide continuing care for the special needs child after their primary caregiver(s) are gone; and, making the transition from one care situation to another as easy as possible for the special needs child.
Raising a special needs child is expensive. Many families simply cannot do it without some government assistance. Having money gives a special needs family options that may not be otherwise available. Even without a lot of significant financial resources, a properly created supplemental needs trust can ensure eligibility for government benefits and still provide additional funds for an enhanced quality of life. Association with competent legal and financial professionals is key to properly managing the best available options for the benefit of your special needs child.
Carol Johnson Law Firm, P.A., partners with financial institutions and planners who have certified special needs financial advisors that are skilled in the investment strategies that best suit the risk aversity inherent in a special needs trust.
Together, with your financial advisor, Carol Johnson Law Firm, P.A., can help you determine how best to achieve your investment goals for the trust, reduce risk and plan for longevity.
Some of the successful Estate-planning strategies utilized by Carol Johnson Law Firm, P.A., include;
Often, a family's wealth management plan includes other children or grandchildren that are not disabled. In this case, while the management vehicle is made more complex, it is still possible, with careful drafting, to define within the asset management vehicle, the supplemental trust that can protect those assets intended for the special needs family member in addition to providing for other children and grandchildren.
Contact Carol Johnson Law Firm, P.A., to discuss your particular circumstances and make an appointment for a free initial consultation.