For parents with special needs children, estate planning is especially important. Most special needs children will need a designated person to care for them after their parents have died. A recent article discusses several aspects of estate planning when special needs children are involved.
When special needs children are involved, an estate plan should include a plan to leave adequate funds to care for the child, as well as a detailed plan for where the child will live and who will care for the child. A common problem that parents experience when creating estate plans is that, due to the current costs of caring for a special needs child, they have trouble saving for later. One way to overcome this problem is to purchase a life insurance policy.
A common transfer tool that many parents use to leave assets to their special needs children is a Special Needs Trust (“SNT”). Through a SNT, a parent can leave assets to their special needs child without interfering with that child’s eligibility for Social Security or Medi-Cal benefits. Moreover, through creating a SNT, the parent can leave detailed instructions for when and how money should be spent. Instructions often include residential and care giving plans.
