Financial Planning for Families with Special-Needs

It’s important to start early.

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The thought of saving for your future can be overwhelming in itself. But for parents who have a child with special needs, the process becomes even more cumbersome. As complicated as it may seem, it is essential to begin early for the future care of your loved one.

Establish a Team of Professionals – When planning for a child with special needs, it is important to establish a team of professionals who can help navigate through the complexities of this type of planning. An estate planning attorney, health care professional and a financial adviser versed in special needs planning can all help to build a manageable plan.

Determine the Amount of Care Needed – Once you have built your team, it will be necessary to determine the amount of care your child will need over their life expectancy. MetLife has a Special Needs Calculator that can help project future costs for individuals with special needs.

Make Sure to Plan for the Unexpected – It is important for the primary caregiver to be insured along with the individual who provides the financial support for the child, if different. If something were to happen to either individual, it could leave the child in a financial crisis. If the child has a shorter life expectancy than the caregiver, a term policy that would cover the expenses through the child’s life expectancy could be considered. However, if the child has a longer life expectancy, a permanent policy, such as a second-to-die life insurance policy, may be a better option.

Consider Availability of Government Benefits – A child with special needs may be eligible for government benefits such as SSI and Medicaid. However, to be eligible the child cannot have a net worth more than $2,000. This limitation is also subject to the five year look back period. Naming your child as a beneficiary on any wills, trusts, retirement accounts or 529 plans may disqualify the child from receiving any governmental aid. Discuss with your estate planning attorney the value of establishing a Supplemental Needs Trusts (SNT) for your loved one. These types of trusts are designed to benefit an individual who has a disability. The assets within these trusts would not negatively affect eligibility for programs such as SSI and Medicaid.

Planning for a child with special needs is complex. One small mistake could lead to huge financial issues. Having a team of professionals who are knowledgeable in this aspect of planning and who know your individual situation will help to ensure a sustainable plan is put into place that will fit your child’s lifetime needs. If you have a child with special needs and you have not yet begun the process of planning for the future, take the first step.


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