As any parent can attest, raising children can be challenging and expensive. Parents of children with disabilities and special needs, however, face many extra challenges and expenses. Luckily, in most cases, children with disabilities qualify to receive some sort of disability benefits.
In order for a child to qualify for government-based disability programs, they must not hold more than $2,000 worth of assets in their name. Provided they meet eligibility requirements, disabled children can receive Social Security Supplemental Income. Additionally, children whose parents meet income requirements may be eligible to receive additional benefits through Medicaid or Social Security Disability Insurance.
Parents of children with special needs or disabilities must often also plan and manage their child’s finances through adulthood. Again, however, there are restrictions on income and assets making it imperative that parents consult a legal professional and financial planner.
A special-needs trust is one option that parents of a disabled child have to provide for a child’s future financial security. An experienced legal professional can advise on how to set up and fund a trust to ensure assets allocated to the trust never exceed an amount that would render the individual ineligible to receive disability benefits. Additionally, a legal professional can advise parents on how to continue to fund the trust in the event of their death.
While disabled and special needs children may face difficult and unique challenges, parents can help ensure their financial future is secured through smart financial and legal planning.
Source: U.S. News & World Report, “How to Financially Prepare for Raising a Child with Special Needs,” Daniel Bortz, Sept. 5, 2012