Important Steps to Plan for the Future of a Special Needs Child
#1 Establish a Comprehensive Plan
Most estate planning attorneys will say that no person should use a “do-it-yourself” will kit to establish their estate plan. If you have a child with special needs, it is extremely important to seek competent legal counsel from an estate planning lawyer with special needs planning experience before and during the process of writing your will.
In your estate plan, make sure that any bequests to your child are left to his or her trust (see #2, below) instead of to the child directly. Your will should also name the person or persons you want to serve as guardian of your child (see #3, below).
Once your estate plan is complete you should give copies to all the guardians and executors named in the will.
#2 Establish a Special Needs Trust
A special needs trust is the most important legal document you will prepare for your child. In order to preserve your child’s eligibility for federal financial benefits like Supplemental Security Income (SSI) and Medicaid, all financial assets for your child should be placed into this trust instead of being held in your child’s name. This is because federal benefit programs restrict the amount of income and assets the recipient may have. If your child has too many financial assets, he or she could lose his eligibility for important federal assistance programs.
You can use this trust as a depository for any money you save for your child’s future, money others give as a gift, funds awarded in a legal settlement or successful lawsuit, and other financial assets.
Should you create a special needs trust if your child doesn’t currently have any financial assets? Yes. Once you create the special needs trust, then the trust can immediately become the named beneficiary of any life insurance policies or planned bequests, either yours or family members’.
#3 Appoint a guardian and complete necessary guardianship papers
Like any parent, you worry about who will care for your child if you were to die before the child becomes an adult. Unlike other parents, you worry about who will care for your child and provide guidance even after he or she is an adult.
A legal guardian is the person who will care for your child after your death and until the child turns 18. If your child is unable to live independently, then you can either make arrangements for adult care or discuss your preferences with the appointed guardian.
As you consider choices of a guardian for your special needs child, consider how much time is required to raise a child with special needs. Who do you know who can respond to the challenge? Who do you know who has already formed a bond with your child?
After you make a choice, ask the individual if he or she will accept the responsibility of serving as your child’s named, legal guardian. It is never wise to keep this decision a secret. Also, discuss with your selected guardian how he or she will probably still have responsibilities toward your child even after his or her 18th birthday.
#4 Apply for an adult guardianship
Even if your child is still a minor, you can start planning now for when he or she reaches the age of majority. When children turn 18, the law considers them adults and able to make their own financial and medical decisions. If your special needs child will be incapable of managing his or her own health and finances, consider a legal guardianship.
#5 Prioritize your savings account
Parents of special needs children quickly learn that their children need many resources and equipment that insurance and school systems do not cover. The more financial assistance you can give your child, the better. Start saving as early as possible for your child’s lifetime needs – just remember to not open the savings account in your child’s name
Savings can help pay for therapies, equipment, an attorney to advocate for your child in the school system, or a special education expert who can help you make sure your child is getting access to all the programs he or she qualifies for.
#6 Plan for your child’s adulthood
Early planning for your child’s adult years will help you bring the legal and financial picture into sharper focus. Will your child continue to live with you? If so, will he or she need in-home assistance? How often? Do adult day care programs for people with special needs exist in your community? How are they rated?
Is your goal for your child to live independently? If so, what support will he or she need? Will your child live in a group home, an assisted living community, an apartment with on-site nursing care, or another type of situation? The earlier you research available options in your community, the sooner you can add your child’s name to the waiting list for the living situation you both prefer.
#7 Write a letter of intent
A letter of intent is not a formal legal document. It is more like a manual of instruction, containing your wishes for your child’s upbringing. In the best case scenario, you would give this letter of intent to your child’s chosen guardian and to anyone else who will play a significant role in his or her life after your death.
- What is your child’s daily routine? What kind of weekly and monthly routine does she have?
- What does he find especially comforting? What frightens her? What are favorite foods, books and movies? Be as detailed as you wish.
- List all of your child’s health care and educational providers.
- List all current medications, doses and schedules.
- List all allergies.
- Are there people you don’t want your child to spend time with? Be specific.
- Are there people you want your child to spend time with? Who?
- Are there activities you especially want your child to try, such as sports or arts and crafts?
Update this letter at least once a year. Keep a copy wherever you keep copies of your will. And be sure to give a copy to your child’s appointed guardian.
#8 Talk with family members
Either in person or in writing, explain the major decisions you have made to important family members. It is especially important to explain to generous grandparents and other relatives why they must not leave gifts of money – or inheritances – directly to your child. Give relatives the information about your child’s special needs trust and instruct them to leave any financial gifts to the trust. Similarly, explain that family members should designate the trust – not the child – as the beneficiary of life insurance policies and so forth.
If you have made decisions you fear will be unpopular (such as naming a guardian), consider explaining your reasons directly to family members whom you fear will be unhappy. You could also consider including the named guardian in these difficult conversations.
The process of planning for your special needs child’s future may seem long and arduous at times, but you will experience a great relief when the major pieces of the plan are in place. Creating a plan for the future will allow you to relax and enjoy the present with your child and family.