Securing the future of a child demands careful planning and thoughtful consideration, especially if they have developmental disabilities that require them to receive lifelong support from loved ones. Estate planning creates a safety net for children that can last a lifetime and beyond, helping them maintain their quality of life and receive the care they need even when their parents or guardians are no longer around.
However, creating this comprehensive legal plan can be complicated, opening doors to mistakes that could affect the estate plan’s efficiency. Here are some common missteps you should avoid to ensure your plan works for your child’s benefit.
Not creating a special needs trust
In estate planning, one of the most significant mistakes you can make is not establishing a special needs trust for your child.
On average, children with common developmental disabilities like autism spectrum disorder need $60,000 per year throughout their childhood. This further highlights the importance of having a financial plan that will continue to provide care for them when they most need it in the future. However, leaving assets directly to your child can jeopardize their eligibility for government benefits. A special needs trust will enable you to allocate much-needed funds for your child while ensuring they can still receive government aid like Medicaid and Supplemental Security Income.
Choosing the wrong trustee
The trustee you choose will manage the trust’s assets and make all the critical decisions for your child’s care. Without careful consideration, you might choose someone who may not have your child’s best interests at heart, leading to mismanagement and further complications.
When you have a child with special needs, estate planning is more than about distributing your assets. It becomes about laying the foundation to allow your child to receive the care they need even when you are no longer around.
