Top Tips for Helping Families with Special Needs

The unique planning requirements of families with children, grandchildren or other family members (such as parents) with special needs can be numerous. Misconceptions in this area can result in costly mistakes when planning for special needs beneficiaries. Understanding the pitfalls associated with special needs planning is a must for all of those who have loved ones with special needs.

Tip #1: Avoid disinheriting the special needs beneficiary. 

Many disabled persons receive Supplemental Security Income (“SSI”), Medicaid or other government benefits to provide food, shelter and/or medical care. The loved ones of the special needs beneficiaries may have been advised to disinherit them - beneficiaries who need their help most - to protect those beneficiaries' public benefits. The best solution is for loved ones to create a special needs trust to hold the inheritance of a special needs beneficiary. 

Tip #2: Procrastinating can be costly for a special needs beneficiary.

It is important to plan early, just as you should for other dependents such as minor children. Minor beneficiaries without special needs can obtain more resources as they reach adulthood and can work to meet essential needs, but special needs beneficiaries may never have that ability. This is one area where families simply cannot afford to wait to plan.

Tip #3: Don’t ignore the special needs of the beneficiary when planning. 

Planning that is not designed with the beneficiary's special needs in mind will probably render the beneficiary ineligible for essential government benefits. A properly designed special needs trust promotes the comfort and happiness of the special needs beneficiary without sacrificing eligibility.

Tip #4: Use great caution in choosing a trustee. 

Loved ones or family members can manage the special needs trust if they are willing to serve and have proper training and guidance. Once the family member or loved one is no longer able to serve as trustee, they can choose who will serve according to the instructions provided in the trust. Families or loved ones who create a special needs trust may choose a team of advisors and/or a professional trustee to serve. Whomever they choose, it is crucial that the trustee is financially savvy, well-organized and of course, ethical.

Tip #5: Invite others to contribute to the special needs trust. 

A key benefit of creating a special needs trust now is that the beneficiary's extended family and friends can make gifts to the trust or remember the trust as they plan their own estates. For example, these family members and friends can name the special needs trust as the beneficiary of their own assets in their trust or will, and they can also name the special needs trust as a beneficiary of life insurance or retirement benefits. 

Tip #6: Relying on siblings to use their money for the benefit of a special needs child can have serious adverse effects. 

Many family members rely on their other children to provide, from their own inheritances, for a child with special needs. This can be a temporary solution for a brief time, such as during a brief incapacity if their other children are financially secure and have money to spare. However, it is not a solution that will protect a child with special needs after the death of the parents or when siblings have their own expenses and financial priorities.

Planning for a special needs beneficiary requires particular care and knowledge on the part of the planning team. A properly drafted and funded special needs trust can ensure that special needs beneficiary has sufficient assets to care for him or her, in a manner intended by loved ones, throughout the beneficiary's lifetime. Our experienced attorneys at Elder Law of Omaha offer complimentary 30 minute consultations regarding special needs trusts and other estate planning options. Schedule your appointment today by calling 402.614.6400.