Planning ahead for the financial requirements of your special-needs child presents unique problems. For instance, some parents think they should start saving education funds for a child with Down’s syndrome or severe autism because they hope their child will someday become self-sufficient and might be able to go to college, but this may not be a good move. Children with conditions such as these have a wide range of developmental possibilities, so traditional savings and education plans may not work too well for them. This is because there are currently a number of governmental benefits that will be available to the child as an adult, but many of these are based on financial need, and if the child has any assets at all, he or she will not qualify.
An account in your child’s name can also spell trouble in other ways, as he or she might not have the ability to make sound financial decisions, leading them to spend the money unwisely. Worse yet, he or she, as a person with a disability, may be a target for swindlers and con artists.
In this situation, not only do parents need to plan for the child’s future as an adult, but they should also make plans in the event that one or both of them should die before the child reaches adulthood. The best way to do this is to meet with a good estate-planning attorney who has experience establishing special-needs trusts. These types of trusts are designed for special-needs children who may need help with financial decisions in the future. With a properly structured special-needs trust, the child—when he or she becomes an adult—will have money to help with his or her living expenses, such as rent, mortgage payments, entertainment, and educational expenses while still qualifying for government benefits.