Special Needs Planning for Tomorrow: One Gooooaaaal!
The FIFA World Cup captured the world’s attention this past summer as soccer has become the most popular sport on the planet. As I was enjoying the spectacular games, I realized that soccer has one goal: To end the game with more goals scored than the opponent. I know this seems obvious, but many times the “one goal” is obvious. The challenge is actually accomplishing that “one goal.”
Special Needs Planning is no different than soccer, in regards to having one goal. Every family has one goal, to ensure a secure future for their child. This goal is as simple as soccer’s one goal, however, the challenge is in carrying it out. A family has no chance in reaching this goal if they do not understand the rules associated with making it happen, and the steps that need to be taken. Let’s consider some of those steps:
1.Clarify your child’s definition of an independent life
a. What type of supports will they need?
b. Where will those supports take place (in your home, in their home, in a supported living environment, group home, etc.)?
c. Who will help provide those supports (people, organizations, etc.)?
2. Pinpoint the costs associated with your child’s lifetime needs
3. Identify the financial resources
a. Understand government benefits
- How to qualify?
- When to qualify?
- Which benefits will provide the services your child needs?
- Protect these benefits for your child’s entire life (especially when you are gone)
b. Money from your child working (part-time or full-time)
c. Assets from Family (like grandparents, aunts, uncles)
d. Savings from you
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4. Incorporate a Special Needs Trust into your child’s plan, as well as an ABLE account.
a. Special Needs Trust can be used for Lump sums and will most likely be used for the large majority of resources you or other family members want to leave your child in order to help financially support their lifetime needs
b. ABLE accounts can be used in conjunction with Special Needs Trust depending on your child and the path of their life
5. Ensure your plan considers taxes
a. Funding your child’s special needs trust with an IRA or 401(k) will have a drastically different tax impact than funding it with life insurance or a savings account
6. Be careful in choosing your Trustee (person or people or organization) for the Special Needs Trust (or ensure they have a professional and experienced guide to help them)
a. Taxes can be tricky as they manage the trust from year to year
b. When using the money from the trust, distribution rules from social security must be strictly adhered to or access to government benefits and the coinciding services that help support your child can be lost
7. Appoint the people or person or team that will keep an eye on your child when you no longer can. Basically, ensure you think through who can take your place as an advocate for your child so their life is always full and robust
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These steps can seem daunting, just like winning the World Cup. Before you can accomplish your “one goal,” you must take the same first step every World Cup team must take—assemble a team with the level of expertise and specialization needed in order to accomplish your “one goal.”
For more information on how to prepare for the future, be sure to contact a financial advisor who specializes in serving families with special needs. A Special Needs Plan is driven by their purpose of leading families to independence through an on-going multi-generational plan. A Special Needs Plan is passionate about families confidently moving forward.
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Charlotte, NC 28204
Ryan F. Platt, MBA, ChFC, ChSNC, is a registered representative of and offers securities, investment advisory, and financial planning through MML Investors Services, LLC, member of SIPC. A Special Needs Plan is not a subsidiary or affiliate of MML Investors Services, LLC, or its affiliated companies. This article is not a recommendation or an endorsement of any products.
This article was featured in Issue 80 – Conquering Challenges With ASD