If you’re a parent of a child with special needs, you already know that your planning needs are different. Not just for school, routines, or medical care. But for the future – your child’s future, especially after you’re no longer around to guide them. This is where special needs estate planning comes in. It’s not just important. It’s essential. And not just when your child turns 18. Ideally, you should start years before.
Most parents don’t get warned about what could happen without a plan. Or worse, they assume their regular estate plan is enough. It’s usually not.
The Risk of Losing Government Benefits
Here’s a common mistake: leaving assets directly to your child with special needs in a will. It sounds like love. But that gift could cost them everything – at least when it comes to government support.
Medicaid, Supplemental Security Income (SSI), and housing assistance are all “means-tested.” That means if your child has more than $2,000 in their name, they could lose access. Not forever. But it’s a mess to fix, and they could go months without support. You don’t want that.
This is why special needs estate planning focuses on legal tools like a Special Needs Trust (SNT). When done correctly, the trust holds assets without affecting eligibility for benefits. The trust pays for things government programs don’t – like a phone, internet, dental work, therapy not covered by Medicaid, or trips to visit family.
What Is a Special Needs Trust and Why It Matters
There are two main types: first-party and third-party. First-party SNTs are funded with the beneficiary’s own assets – like from an injury settlement. A third-party SNT is created and funded by someone else, like a parent or grandparent.
Most families will be setting up a third-party trust. This type of trust doesn’t require a Medicaid payback clause, which means remaining assets can go to siblings or other family members after your child passes away.
The trust needs a trustee. That person manages the money and follows the rules. Some parents try to name a sibling as trustee. That might work. But not always. Many choose to use professional trust companies or attorneys who understand these trusts inside and out.
You Need a Written Care Plan
At Fleming Financial Solutions, they don’t just stop at documents. They also emphasize something called a Written Care Plan. Think of it as a guidebook for your child’s future caregivers. It can include medical info, education history, daily routines, favorite foods, dislikes, therapies, and more.
This kind of care plan doesn’t replace legal tools like the trust. But it adds real-life context. It helps family members and future guardians make decisions in line with your wishes – and your child’s needs.
Guardianship and Decision-Making
When your child turns 18, they’re legally considered an adult – even if they aren’t able to make independent decisions. Without proper planning, you lose the right to make medical or financial decisions on their behalf.
You may need to file for guardianship or consider less restrictive alternatives like power of attorney or supported decision-making agreements. These are legal matters, and they vary by state, so don’t guess. Ask someone who works with special needs families regularly.
Estate Planning for Special Needs Adults
Parents often start special needs planning early, but sometimes it happens later. If your child is already an adult and you haven’t done this yet, you still can – and should.
A special needs trust can still be set up. And in fact, planning becomes even more important once your child becomes eligible for SSI or Medicaid. At this stage, any inheritance, gifts, or accident settlements must be handled carefully.
You also want to review your own estate. Make sure your will or living trust directs your assets to the SNT – not directly to your adult child. The same goes for life insurance policies, retirement accounts, and annuities. These need correct beneficiary designations. Estate planning for special needs adults is very important to consider…even when they are still children.
When to Start and Who to Involve
The best time to start special needs estate planning is as early as possible. Before your child turns 18 is ideal. That way you’re not rushing to get guardianship in place or scrambling to protect SSI eligibility.
In most cases, you’ll want to work with professionals who understand the specific needs of your family. That includes someone experienced in special needs trusts, government benefits, guardianship, and long-term care planning.
And you’ll want to revisit the plan as things change – new diagnoses, shifting family dynamics, benefit rule changes, or a new job or home.
What Happens If You Don’t Plan Correctly
Without proper planning, your child could:
- Be disqualified from Medicaid or SSI.
- End up with a guardian the court picks, not one you would choose.
- Have no instructions for future caregivers on how to support their needs.
- Lose access to vital services or therapies during transition periods.
And you could leave family members scrambling to figure out what to do, arguing over decisions, or overwhelmed trying to fix problems that could have been avoided.
Final Thoughts
Special needs estate planning isn’t just about legal documents. It’s about long-term care, financial stability, and peace of mind – for you, your child, and your whole family.
Fleming Financial Solutions helps families manage this process with care, offering guidance not just on the financial side, but on the personal one too. They help families build Written Care Plans, coordinate government benefits, and set up the right legal tools – all with the goal of ensuring continuity of care and a more secure future.
Don’t wait for a crisis. The sooner you plan, the more options you’ll have – and the more control you’ll keep over what happens next.
Daniel J. Morgan is the founder of Invidiata Magazine, a premier publication showcasing luxury living, arts, and culture. With a passion for excellence, Daniel has established the magazine as a beacon of sophistication and refinement, captivating discerning audiences worldwide.
