Estate Planning Considerations for Children With Special Needs

When it comes to estate planning, there are many factors to consider. For families of children with special needs, estate planning can be especially important, and there are a variety of complex issues that will need to be considered. By putting the proper measures in place, a family can make sure children will have the resources they need. In these situations, it is crucial for family members to work with an attorney who understands the best ways to utilize the available options for providing for children’s current and future needs.

Understanding the Unique Factors That Affect Children With Special Needs

Children with special needs often require ongoing medical care, therapy, and support throughout their lives. They may also be eligible for government benefits such as Medicaid or Supplemental Security Income (SSI). However, if financial issues are not handled correctly, their ability to receive these benefits may be affected. 

Some key considerations to address when determining how to provide for special needs children include:

• Guardianship: For parents of special needs children, designating a guardian who will take care of the child in the event of their death is essential. This may be done in a person’s will. In some situations, it may also be necessary to establish guardianship for an adult family member with special needs, which will ensure that their financial and personal affairs will be handled correctly.
• Special needs trusts: Family members who wish to use their assets to provide financial assistance for a child with special needs will need to make sure the child’s ability to receive government benefits will not be affected. A special needs trust allows assets to be used to supplement a person’s daily living expenses or pay for additional medical treatments not covered by insurance. Since assets will be owned by the trust rather than the child, they will still be able to qualify for public assistance.
• Caregiver instructions: An estate plan may provide detailed instructions about a child’s routines, medications, therapies, and preferences. This can help ensure that they will receive the proper care even if parents pass away or are no longer able to meet their needs.
• Budgeting for future expenses: Estimating the future costs of caring for a child with special needs is crucial. These costs may include medical expenses, therapy sessions, assistive devices like wheelchairs or communication aids, education costs, housing arrangements, transportation services, and recreational activities. An estate plan can include provisions for addressing these needs.

The Role of Life Insurance in Estate Planning

Life insurance can play a significant role in providing financial security for a child with special needs. It can help cover ongoing expenses, pay off debts, and fund special needs trusts. Term life insurance policies can provide coverage for a specific period (e.g., 10, 20, or 30 years). They can be tailored to align with a child’s anticipated financial needs. Other options, such as irrevocable life insurance trusts, may be used to ensure that the payouts from life insurance policies will be used correctly to benefit a child with special needs.

The Importance of Regularly Updating Your Estate Plan

Estate planning is not a one-time event. A plan should be regularly reviewed and updated as circumstances change. This is especially true for family members of children with special needs, since their care requirements may change over time.

To ensure that an estate plan remains current, it is important to:

• Review beneficiary designations: Adjustments may need to be made to the named beneficiaries on retirement accounts, life insurance policies, and other assets to ensure they align with a person’s wishes while providing for beneficiaries’ needs.
• Update guardianship designations: As relationships change or circumstances evolve, a will may need to be updated to specify who will serve as a guardian for a minor child in the event of a parent’s death. Issues such as divorce or changes in family relationships may require guardianship designation to be changed.
• Maintain communication: Family members should make sure to communicate with each other to ensure that they understand their roles and responsibilities when addressing the needs of children or handling other issues related to an estate plan.

Contact Our Naperville Special Needs Estate Planning Lawyer

If you have a child with special needs, or if you are looking to provide assistance for a family member with disabilities, the Gierach Law Firm can help you understand your options. Our DuPage County estate planning attorney will provide guidance on the steps you can take to address a child’s needs while addressing your family’s financial concerns. Contact us at 630-228-9413 to set up a consultation and receive the dedicated legal help you need.