When you are a parent of a special needs child, you want to care for them in the best way possible. As part of that, you need to think about the long-term, especially how to provide for your child when you pass away. Most likely, you want to ensure your child maintains their quality of life through the years, while at the same time allowing your child to remain enrolled in government benefit programs.
Many parents of special needs children opt for establishing a trust for their child, even if the child now is an adult. With a trust, parents can limit how much a special needs child receives each month to ensure the funds don’t disqualify the child from receiving Medicaid, Supplemental Security Income payments or food stamps.
What to keep in mind with a special needs trust
The first thing you should know if you are a parent of a special needs child is that you don’t need to be wealthy to establish a special needs trust. Even if a child receives only $2,000 in assets when you die, that could disqualify them from government benefits until they spend that money.
Also, any assets a special needs child or adult receives from a trust can’t go toward housing or food if the recipient receives government benefits. Finally, managing a special needs trust isn’t easy, so often parents opt for a company, nonprofit or another third party to handle distributing the funds to their special needs child.
Other important aspects to address in a trust
As part of the trust, you can name a guardian for your special needs child. If your child is an adult, he or she may still need a named guardian if they can’t make decisions on their own. Also, you name a health care surrogate and a power of attorney to ensure someone you trust is handling health care and financial decisions concerning your child.
Setting up a trust for your special needs child is complicated. You should work with an attorney who has experience in handling special needs trusts so you know the trust will take care of your child for years to come.