Amy McCormick, Vice President, Trust Officer, D.A. Davidson Trust Company
While all parents are concerned for their children’s well-being, parents of children with special needs face additional challenges in planning for that person’s long-term care and financial support. Early planning and extra consideration can help alleviate fears and produce a strategy that reduces stress.
The need for planning becomes even more evident as a special needs child becomes a teenager — with the changes and challenges of adolescence requiring changes in planning. Here are several common issues for parents and guardians to consider when developing a plan for special needs family members who are nearing adulthood.
When a child reaches the age of majority, usually 18, the rules applying to that person’s legal standing change. A parent may no longer have legal standing to act on behalf of a child for educational or medical purposes. With the help of a legal professional, parents may want to consider whether a guardianship or conservatorship is appropriate, or authorize a power of attorney to cover financial or health care decisions.
Transition from School
Transitioning from a school environment to the workplace or an appropriate next step can be a significant change for any special needs person. Many special education programs end at age 21 and finding the right next routine for your child’s next stage in life can sometimes take years of planning. Whether a special needs child moves to an adult day care program, secondary education, a workplace or some other adventure, any move away from the school environment should be considered carefully and planned well in advance.
Some special needs individuals can live on their own with minimal support. Others may need a higher level of professional caregiving, perhaps in a supportive living environment or group home. Some may thrive in a home environment with their parents and caregivers. Determining the needs and desires of the individual requires discussion, planning and an understanding of how to identify an optimal housing solution.
Becoming an adult at age 18 may allow your child to receive additional government benefits based on his or her own income and resources. Retaining eligibility for government benefits can be important for people with high health care costs or those who want to access the services of a vocational or community-based waiver program. These benefits can help you shape your long-term plan.
It is important to analyze and consider costs of care for your special needs child not just today but for the long term. This allows your family to start planning for caregiving and/or housing. A special needs trust may be a tool for resolving some financial issues, whether it is created now or later. You may use various sources to fund a trust over time, including life insurance. Your Financial Advisor or a D.A. Davidson Trust Company professional can assist in getting you started and helping you understand what type of trust might be appropriate.
Letter of Intent or Care Plan
Creating a plan for your child in the event that something unexpected happens, or you are no longer able to care for your child, is an important component of your strategy. The plan should include a list of doctors, medications, and other medical needs; your thoughts on educational or vocational goals; living situations that best provide independence and security for your child; and any benefits your child receives. The plan can also include items that are a meaningful part of your child’s life: his or her preferences for work, activities, entertainment, meals or even favorite ice cream. Memorialize the important information that is unique to your child and share it — enabling others to support your child if you are no longer able to do so.
These are among the common considerations that family members of people living with special needs may encounter. Remember that even with diligent planning, it is important to continue regular communications with family members and to update your estate plan on a frequent basis. As your child grows, ages and changes, so does your need to account for any situational changes, from guardians and health care to home and work environments. Early planning can help you achieve what every parent wants for his or her child: a better quality of life. Talk with your D.A. Davidson Trust Officer today, or find one here, to start the conversation about building a strong financial foundation for your child.
Information contained herein has been obtained by sources we consider reliable, but is not guaranteed and we are not soliciting any action based upon it. Any opinions expressed are based on our interpretation of the data available to us at the time of the original publication of the report. These opinions are subject to change at any time without notice. Investors must bear in mind that inherent in investments are the risks of fluctuating prices and the uncertainties of dividends, rates of return, and yield. Investors should also remember that past performance is not necessarily an indicator of future performance and D.A. Davidson & Co. makes no guarantee, expressed or implied to future performance. Investors should consult their financial and/or tax advisor before implementing any investment plan.