There are many cases where a person may wish to help provide for the needs of loved ones who have special needs. Since people with physical disabilities, mental impairments, or other conditions may be unable to work and earn an income, they may struggle to provide for themselves. To ensure that a person’s ongoing needs will be met, family members may wish to step in and provide financial assistance. However, they may not realize that giving money to a person, buying items for them to use, or otherwise providing them with financial support may disqualify them from receiving government aid. To preserve a person’s right to receive public benefits, family members may create a special needs trust. Setting up this type of trust can be an important part of the estate planning process.

Why Should I Use a Special Needs Trust?

People who suffer from disabilities that affect their ability to maintain gainful employment may qualify for multiple types of benefits. However, to receive these types of benefits, they will usually need to show that they have limited financial resources. For example, to qualify for Supplemental Security Income (SSI) through Social Security, a person’s financial resources must be under $2,000. Because of this, a family member who gifts a significant amount of money or property to a person with special needs may cause the person to be ineligible for SSI or other benefits.

To prevent the possibility of jeopardizing a person’s public benefits, a family member can create a special needs trust and name the disabled person as the beneficiary. In these cases, the assets a person wishes to use to help their loved one will be owned by the trust rather than the person with a disability. Distributions from the trust may be provided to the beneficiary to help them meet their ongoing needs while also ensuring that they will be able to receive ongoing government benefits.

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No parent wants to think about passing away before their children have grown, but tragedies happen every day. Sadly, if families are unprepared for such an issue, their children may be further traumatized by the events that occur after their loss. As such, all parents are encouraged to name a guardian for their child in a legally drafted will. Learn more about this process, including how to choose the right person for the job, with help from the following.

Guardianship is Not Automatic

Above all else, parents need to know that guardianship is not automatic after a tragedy. For example, you may assume that your parents would automatically receive your children if something happened to you, but this is not the case. Instead, anyone that is interested in custody of your children can come forward and request it. Then a judge must hear each person's side and determine which home may be most appropriate.

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According to data from the Centers for Disease Control and Prevention (CDC), one in seven American children have some form of disability. Some suffer from behavioral and mental health issues. Others have developmental disabilities or congenital defects that severely impact their ability to care for themselves. Many of them could be at risk for issues in the future, once their parents are no longer around to care for them. Thankfully, estate planning offers parents a way to mitigate some of those risks. The following explains.

Choosing a Guardian for Your Child

If you know that your child will need lifelong care, it is critical that you create a will or estate plan and name at least two potential guardians to care for your child. The first can be the primary. The second can be someone who would assume care, should the first person pass away or be unable/unwilling to care for your child. You might also wish to set up an emergency care person - someone who would assume temporary care for your child, should you pass away suddenly. This can ensure they stay out of the state's care and in the care of someone you know and trust.

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No parent wants to think about dying before their children reach adulthood. Sadly, it does happen, and often before the parents have had the chance to create a will. This can leave children in limbo, create problems for their financial future, and ultimately impact their quality of life. Know how to protect your child with a carefully crafted will.

Designate First Responders

While most parents know who they would want to serve as a long-term guardian for their children, and may have even already discussed the idea with the selected person, many fail to consider what will happen in the minutes, hours, and days immediately after their death. For example, consider the following scenario: You are on your way to pick up your children from school but are killed in an accident. What happens next? Who will pick up your children and ensure they are cared for?

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According to the 2010 U.S. Census Bureau, Americans with Disabilities Report, nearly one in five families are caring for a family member with a disability. Equating to about 56.7 million people, or 19 percent of the total population, the U.S. has witnessed an increase in those with qualifying disabilities by 2.2 million citizens. Not only has the number of those with disabilities risen, but the number and percentage of those requiring assistance has also increased.

The report also relates that four in 10 individuals with a disability, ages 21 to 64, often find themselves unemployed and facing persistent poverty levels as the ability to obtain viable employment opportunities may be out of reach.

As reported, one in every 26 American families are facing the challenges of raising a child with special needs, and 69 percent of those caring for a child report that they are concerned about providing lifetime care for their dependents with special needs.

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