Raising a child is expensive, but the costs can increase tremendously for families raising children with disabilities. For instance, with expenses such as medical care, lost parental wages, education expenses, and residential care, the lifetime costs to support and care for a person with autism frequently range from $1.4 million to $2.4 million.1
If you’re the parent of a child with special needs, you know the importance of planning for lifelong care: especially after your passing. It can be difficult to contemplate, but with patience, love, and perseverance, a long-term strategy is attainable and can help bring some peace of mind for yourself and your loved ones. Here are four important steps to get you started.
1: Envision a Life After You
Imagining life after your passing is emotionally tough for most people. When there is someone dependent on you for the rest of their lives, it can be even harder to bear. Nevertheless, the parents and loved ones of people with special needs must prepare for this future. Just as every child with special needs is unique, so are the challenges facing their families when planning for the long term.
Think about the potential needs of your child. What will they require to maintain their standard of living? This could include services like:
- Daily custodial care
- Ongoing medical treatments
- Physical therapy
- Group home vs. independent living arrangements
- Assistance from family members
Thinking about these concerns now can help form the vision of what may need to be done to plan for your child’s care. When possible, we highly encourage parents to involve their child in this process by engaging in conversations about their own hopes and dreams.
2: Address Estate Planning Concerns
Without proper planning, your child’s lifetime needs can quickly outstrip your funds. One resource is government benefits, such as Supplemental Security Income (SSI) and Medicaid, which your child may qualify for depending on their situation.
Because such government programs have extremely low asset and income limits for qualification, you may want to consider whether to make property transfers to your special needs child. Assets in their name can cause them to lose important benefits in the future.
Contrary to what many people believe, you do not need to disinherit your child for them to receive benefits. There are tools that families can use to provide for their loved one without disqualifying them from important benefits. Special needs trusts and ABLE accounts can be used to help you provide for your family member both while you are alive and after your death.
Special Needs Trusts are not one-size-fits-all, so it is imperative that you seek out an attorney who specializes in special needs planning.
3: Involve Other Family Members
All affected family members should be involved in the decision-making process. Gather your child’s siblings, aunts and uncles, and grandparents to begin an open dialogue with those who may be able to step in should the need arise. Be transparent in what would be required of them. Caring for a loved one with disabilities can be time-consuming and stressful, so you shouldn’t assume that a given family member will or will not be willing or able to step in to provide support.
You’ll want everyone to have realistic expectations of what may be expected of them in the future. This can also help you better identify areas of concern that family members may not address.
4: Write a Letter of Intent
Your will and special needs trust will lay the legal groundwork for supporting your child financially, but they don’t discuss the day-to-day aspects of your child’s life after you are gone.
For this reason, we highly recommend that parents write a Letter of Intent to guide those who take over roles in caring for your child after your death.
A Letter of Intent isn’t a legal document, but it may help communicate your desires and other information that future caregivers may need. This can take the form of a narrative letter, or you can use a form to lay out the details.
Some useful information to include:
- Who you would like to serve as guardian or conservator.
- Where you would like your child to live.
- Names and contact information for your key people such as doctors, caregivers, family, and friends.
- A list of your child’s medications and medical needs with detailed instructions.
- A description of a typical day or week for your child.
- A description of your child’s favorite activities.
- Words, phrases, and behaviors to avoid.
- How to deal with difficult behaviors or situations.
Store this letter alongside your will in a safe place.
Some people may prefer a digital approach to a Letter of Intent, such as using online storage or software such as Vest (vestlife.com) to compile and share information both in your life and after your death.
Planning for a child with special needs can be complicated and overwhelming, but you don’t have to do it alone. Working with loved ones and qualified professionals can help you navigate the various facets of this challenge.
Do you have a loved one with special needs? Britta Koepf is a Chartered Special Needs ConsultantⓇ. Give us a call today for help planning your family’s financial future.
This content is developed from sources believed to be providing accurate information and is provided at least in part by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security. Original content of Practical Financial Planning, Inc. only is copyright © 2021 by Practical Financial Planning, Inc.