Planning for a child with special needs means thinking beyond a basic will or inheritance plan. The wrong approach can unintentionally affect important government benefits like SSI or Medi-Cal, while the right estate plan can help protect your child’s financial security, care, and quality of life for years to come.
Tools like special needs trusts, guardianship designations, letters of intent, powers of attorney, and ABLE accounts can all play an important role. In this blog, we’ll explain why estate planning is so important for special needs families and how the right legal guidance can help you plan with confidence.
If you have questions about estate planning for a special needs child, contact Mohajer Law Firm today to schedule a consultation.
Hi, I’m Sina Mohajer from Mohajer Law Firm. We specialize in family law, estate planning, criminal defense, and personal injury.
You probably noticed that we are currently indoors and not strolling in our beautiful park. Regardless of rain or shine, I want to take these opportunities to provide you with information that can potentially help you in your case. Although we’re not walking in a park, the information you receive is meant to be simplified as if it is a walk in the park. So if you like the contents of this video, please hit that like button, and don’t forget to subscribe so you’re always informed of any new videos being posted. Without further ado, I welcome you to our series called A Walk in the Park.
I want you to think about this question. If you have a child with special needs, how can you ensure they’ll be financially protected and properly cared for even when you’re gone? In this video, I’m going to cover the essential tools and strategies parents need to build a secure future for their child without risking government benefits or creating legal complications.
Specifically, I will address why estate planning is critical for special needs families, what a special needs trust is and how it works, additional estate planning tools for special needs families, as well as how an estate planning attorney can help.
Why Estate Planning Is Important for Special Needs Families
So why is estate planning so critical for special needs families? Traditional wills and inheritance plans may unintentionally disqualify a child with special needs from vital government benefits, such as SSI or even Medical.
So when you leave assets directly to a child with disabilities, even with good intentions, it can cause them to exceed income or asset limits, putting their long-term support at risk.
Proper estate planning isn’t just about passing down wealth. It’s about preserving eligibility and ensuring lifelong care.
Special Needs Trust
Now let’s talk about a special needs trust. What is it? How does it work?
A special needs trust is a legal tool that holds assets for the benefit of an individual with disabilities without affecting their eligibility for needs-based programs.
Some types of these special needs trusts are third-party special needs trusts, funded by parents or relatives, ideal for estate planning. And then there’s also first-party special needs trusts, which are funded by the child’s own assets. For example, if they received a personal injury settlement.
Funds from the trusts can be used for non-covered expenses such as education, therapy, caregiving, travel, and quality of life enhancements.
Please make sure that the trust must be properly drafted and administered to comply with both federal and state laws. Any error or mistake can result in disqualification.
Additional Estate Planning Tools
Besides the special needs trust, there are additional estate planning tools available for special needs families as well.
Guardianship Designation
There is a guardianship designation, which clearly names a guardian to care for your child if you become incapacitated or pass away. Someone who really understands your child’s needs and routines.
Letter of Intent
There is a letter of intent, which is a non-legal document that outlines your child’s medical history, daily care plan, routines, preferences, and long-term goals, which is so essential for continuity of care.
Powers of Attorneys and Medical Directives
There are powers of attorneys and medical directives. So as your child approaches adulthood, these are legal documents that may be needed to manage health care and finances if they are not capable of doing so independently.
ABLE Accounts
There are ABLE accounts, also known as California CalABLE, which are tax-advantaged savings accounts for individuals with disabilities that allow up to $100,000 in savings without affecting SSI benefits. Such a super useful supplement to a trust.
When to Contact an Estate Planning Attorney for Your Special Needs Child
Look, I get what we went over may feel like too much, but this is why it is very important to seek help from an experienced estate planning attorney. Every family’s needs are different. An experienced attorney can help not only draft a special needs trust tailored to your child’s unique situation, they can coordinate with public benefits to avoid conflict. They can name successor trustees and guardians and integrate trusts with life insurance, wills, and retirement accounts.
Realize, when you plan early, it can avoid court involvement. It can preserve benefits and provide peace of mind. Don’t wait until there’s a crisis. Start while you still have full capacity and legal control.
If you’re a parent of a child with special needs, estate planning is not an option. It’s essential. The right plan protects your child’s eligibility for benefits, secures their future, and ensures your wishes are honored.
If you have questions regarding your case and would like to speak to a seasoned estate planning attorney, I welcome you to contact our office and schedule a consultation. We would be more than happy to sit down with you one-on-one and discuss your options.
And as I stated in the beginning, if you like the contents of this video and you found them to be helpful, hit that like button, and don’t forget to subscribe so you’re always informed of any new videos being posted.