Raising a child is expensive, and costs can increase significantly for families raising children with disabilities. For example, the average lifetime cost for a person with autism is estimated to be between $1.4M and $2.4M.1
If you are a parent of a special needs child, 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. Here are four ways to help financially protect your loved one.
Step 1: Envision a Life After You
Just as every child with special needs is unique, so too are the challenges that their families face when planning for the long term.
Think about your child’s potential needs. What will they require to maintain their standard of living? This could include items such as the following:
- Daily custodial care
- Ongoing medical treatments
- Physical therapy
- Group home vs. independent living
- Assistance from family members
Thinking about these factors now can help form a vision of what may need to be done to plan for your child’s care.
Step 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, for which your child may qualify, depending on their situation.
Because such government programs have low-asset thresholds for qualification, you may want to consider whether to make property transfers to your special needs child.
You should also make sure you have an up-to-date will that reflects your wishes. A special needs trust, for example, can be structured to fund your child’s care without disqualifying them from government assistance.
Step 3: Involve Other Family Members
All affected family members should be involved in the decision-making process. Gather your child’s siblings, aunts, uncles, and grandparents, and begin an open dialogue about who may be able to step in should the need arise. Be transparent about what would be required of them. Caring for a loved one with disabilities can be time-consuming and stressful; you will want everyone to have a realistic idea of what may be expected of them in the future. This process can also help you better identify areas that other caregivers may not be able to address.
Step 4: Identify a Caregiver
A caregiver must be appointed as a guardian if he or she will need to make financial and healthcare decisions after your child reaches adulthood. This can take time, so start setting this in motion as soon as possible.
To do this, you can write a Letter of Intent to the caregiver and family to express your wishes, along with information about your child’s care. This is not a legal document, but it may help communicate your desires. Store this letter in a safe place alongside your will.
Planning for a child with special needs can be complicated and overwhelming, but you do not have to do it alone. Working with loved ones and qualified professionals can help you navigate the various facets of this challenge.
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Storybook Financial is a financial planning firm determined to help those that believe in the betterment of the world around them. As a fiduciary, our service promotes unbiased financial planning with an emphasis on young medical professionals and their families. We are constantly pushing for new ways to give back to the Cystic Fibrosis community. We are based out of Iowa City | Coralville Iowa, but we serve clients nationwide with our robust virtual presence. This content is developed from sources believed to be providing accurate information, and provided 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.