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  • Special Needs Planning in 5 Steps – Part 1

    Special Needs Planning in 5 Steps – Part 1

    If you have a child with special needs, you know they’ll need extra planning to make sure they’re well cared for in the future. But special needs planning can easily end up on the back-burner when you’re juggling multiple therapy appointments, IEP meetings, and the many other challenges that can happen when supporting a child with special needs. You may also find that your biggest roadblock to completing special needs planning is your own fear of disability and death.

    One way through these fears is to take the process one step at a time and view it as a plan that benefits your entire family today, not just as a plan for what happens when you’re no longer around (though a good plan will do that too!). 

    To get started, let’s break special needs planning down into five steps:

    1 | Learn How Special Needs Planning Can Benefit Your Family

    Special needs planning means creating a plan for continuous, consistent support for individuals with special needs so they can live their best lives while maintaining a tailored balance of autonomy and protection. To achieve these goals, most families need the support of public benefits in addition to the private resources of the family.

    Public benefits like Supplemental Security Income (SSI) and Medi-Cal contribute essential support for individuals who meet Social Security Administration criteria for being “disabled.” While public benefits are meager in some respects – few can survive solely on an SSI maximum benefit of $941 per month, for example – Medi-Cal coverage can provide robust support beyond ordinary health insurance. This can include job exploration and coaching, community integration and day service programs, and even residential care.

    However, an individual with a disability must meet certain low-income requirements to qualify for these programs, and any change in the person’s income may result in the loss or disruption of these benefits.

    The foundational fact of special needs planning is this: Gifts or inheritances given directly to individuals with disabilities disrupt the most essential public benefits like SSI, Medi-Cal, and Housing and Urban Development (HUD) subsidies. 

    Even paying rent for an adult disabled individual or allowing them to live with you rent-free can decrease SSI benefits unless handled properly. Thankfully, special needs planning tools like special needs trusts (also called “supplemental needs trusts” or “SNTs”) and ABLE accounts make it possible for families and individuals with disabilities to maximize these public benefits to enhance their quality of life while preserving family assets.

    If this sounds overwhelming, don’t worry. We can help you create a special needs plan that balances the support your child needs with the needs of your entire family through our heart-centered, counseling-based approach to planning. 

    2 | Identify The Best Level of Support for Your Child

    We will help you envision your child with special needs living their best life, first with your support, and then when it’s no longer possible for you to care for them due to death or disability.  What support do they need now and what support do you imagine they’ll need in the future to have the best possible life?

    With a clear vision, we can help you to map out the best plan, ensuring that plan is properly funded, and that you’ve properly incentivized the people you want caring for your child to do so.

    As your child approaches 18 years of age, this step will also involve exploring whether a conservatorship or a supported decision-making process will best serve your child. In general, in a conservatorship, a court removes certain rights and responsibilities of the individual and transfers them to a conservator, who then is responsible to the court for exercising those duties and powers in the best interests of the individual with special needs.

    By contrast, in supported decision-making, individuals with special needs choose and appoint agents to serve under powers of attorney for healthcare and finances. The choice between these options will depend on the individual’s capacity under state law and on their vulnerability to exploitation.

    Parents of children with special needs will also need to identify other family members, friends, and agencies who can provide support alongside themselves. Even if a parent meets all the needs of an individual with special needs alone, this can result in an abrupt transition to a new caregiver when that parent has an accident or medical event, or when that parent dies. 

    Most individuals with special needs struggle with such abrupt changes, and we believe these individuals are better served by a broader care team that will one day create a more gradual transition in caregivers.

    Helping You Start Your Special Needs Planning Journey

    Whether you recently received a diagnosis that your child has special needs, or you’ve been caring for an individual with special needs for a long time, the idea of formally creating a special needs plan can feel overwhelming. But no matter what stage your family is in, it’s never too late or too early to start special needs planning.

    We understand that at times seeking a proper diagnosis, therapy, and educational support must take priority for your loved one with special needs. To some extent, we must secure the present before we look to secure the future. But at the same time, the financial and social results of delaying your special needs planning can have profound consequences. That’s why the future of your loved one with special needs can best be secured through planning sooner rather than later.

    When you’re ready to take the first step toward special needs planning or revisit planning you’ve already done that may not feel complete, give us a call. We’d be honored to help your family build and implement a plan that will serve your loved one with special needs and your entire family for years to come.

    And don’t forget to check back later this month for part two of this series.

    This article is a service of Jeannette Marsala, Personal Family Lawyer. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Life & Legacy Planning Session, during which you’ll get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by calling our office today to schedule a Life and Legacy Planning Session and mention this article to find out how to get this $750 session at no charge.

  • The Special Needs Planning Lesson We Learned From Aretha Franklin’s Estate Battle

    The Special Needs Planning Lesson We Learned From Aretha Franklin’s Estate Battle

    You may have noticed the recent lawsuit between Aretha Franklin’s children to settle her estate, but did you catch the special needs planning element?  

    Aretha Franklin wowed America and the world as the Queen of Soul, but Aretha didn’t wow us with her estate planning. She left two handwritten wills, and the one a jury ruled valid was found stuffed between her couch cushions.

    To settle a dispute over the two wills, two of her sons went to court against a third, and while the two may have declared victory, it’s hard to feel that anyone truly won. An estate initially estimated to be valued at $80 million was whittled down to $4 million by the time the case was concluded, and while some funds were lost unnecessarily to taxes, a large portion was lost to the lawsuit itself.

    But here’s the special needs planning element you may have missed: A fourth son lives in assisted living under a court guardianship, and his guardian settled with the other three brothers out of court.

    While Aretha’s huge estate will be able to support her son with special needs, most parents won’t have a multi-million dollar estate waiting for their children at their deaths. Most parents of children with special needs need to provide financially for their child while being careful not to disqualify them from much-needed government support programs like Medicaid and SSI. Making sure there is a financial plan for your child with special needs is essential in order to supplement the benefits that child can receive from government programs.

    Balancing Support with Program Eligibility

    The goal of special needs planning is to provide continuous, consistent support for an individual with special needs across their lifetime. Aretha earned the money to provide care for her son without the need for careful planning, but most families need to maximize government benefits such as Supplemental Security Income (“SSI”) and Medicaid to care for a child with special needs and provide for the needs not met by government programs.

    Parents who earn Social Security retirement benefits will be able to provide some of that benefit amount to their child with special needs when they pass away, and a child with a disability can work a limited amount, earn his own Social Security benefits, and eventually qualify for Medicare. Many individuals with special needs, however, receive services through Medicaid which Medicare won’t provide such as job coaching, community integration, and day or residential services. 

    But even with these benefits, nobody can live on the maximum SSI payment of $914 per month, and Medicaid eligibility requires individuals to have under $2,000 in assets (with a few exceptions) to qualify. Because of this, parents of children with special needs must find a way to provide financially for their child while being careful not to disqualify their child from these government programs. 

    Careful Planning Preserves Your Assets for The Entire Family

    To preserve your child’s eligibility for government benefits, the money you leave for the care of a child with special needs cannot go to that child directly. Instead, you must direct any gifts or inheritances into special planning vehicles such as a special needs trust for your child’s benefit.

    If you establish this trust during your lifetime, the assets can be used to supplement government benefits throughout your child’s life and any remaining funds are then passed on to other family members when the child with a disability passes away. But if the special needs trust is set up after your death – in the absence of planning – any remaining funds in the trust must be used first to repay the state Medicaid agency that provided the child’s lifetime of care. 

    While Aretha’s son may end up with a special needs trust established by a court, the rest of the family will never see those funds again because the trust was established after Aretha’s death. By law, government programs are entitled to be paid back for the assistance they provide to people with disabilities out of that person’s leftover estate. At Aretha’s death, the inheritance she left her son became part of his estate, so it’s now subject to pay-back collections for his government assistance when he dies.

    If Aretha had created a special needs trust while she was living, the funds in the trust would still be considered part of Aretha’s estate, even after her death. Her son would have been provided for through this trust but his brothers would then inherit the remaining funds when the son with disabilities passes away. 

    Applying these rules to the Franklin family has its limits. The son under a guardianship may be able to afford a lifetime of private pay – if the taxes and lawsuit didn’t diminish his share too greatly. But even Medicaid care rates for an individual with special needs can range from $50,000 to $350,000 per year – not an amount most families can afford.

    This son may not have children of his own who would benefit from receiving any remaining funds after his lifetime, but many individuals with special needs have children for whom these funds could be meaningful. Likewise, siblings and other family members often devote countless unpaid hours to provide support for their loved one with special needs, sometimes at the expense of their own careers and families. Receiving some inheritance after years of caregiving can help alleviate the financial sacrifices these family members made.

    Helping You Protect Your Child and Their Inheritance with Heart-Centered Guidance 

    It’s my mission to help your family live their best life today and plan for the best possible care for your loved ones tomorrow. Whether you have a child with special needs or an adult loved one who develops a disability ten years from now, I can help your family plan for these situations and more while keeping your family out of court and conflict and preserving family wealth.  

    The first step is to go through our unique planning process called a Family Wealth Planning Session to choose the right plan for you, your kids, and everyone you love. During the session, I get to know your family’s unique needs and dynamics as well as your assets. I’ll share how the law would apply to your situation and exactly what would happen to your assets and your loved ones if something happened to you right now.

    Next, we’ll work together to choose the right plan for you based on the specifics of your family situation and the budget you’re comfortable with. Once this foundational estate plan is created, we’ll review what extra tools may be right for your family or loved one with special needs to ensure they’re cared for and protected no matter what happens.

    While Aretha Franklin missed the opportunity to save her family millions of dollars by using special needs planning tools, your own estate planning and special needs planning can preserve your family’s wealth and ensure a lifetime of care for everyone you love.

    To get started, call me at (650) 600-1735 to learn more about my unique process and how I can help you and your child with special needs live your best lives.

    This article is a service of Jeannette Marsala, Personal Family Lawyer. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session, during which you’ll get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.

  • Estate Planning For a Child With Special Needs: Three Tools You Need to Know

    Estate Planning For a Child With Special Needs: Three Tools You Need to Know

    As a parent of a child with special needs, you’re well aware of the unique challenges that come with caring for your child’s care. You’re an expert on their preferences, routines, skills, and challenges. However, when it comes to securing their future, legal planning can seem overwhelming. You may wonder what tools are the right ones to ensure your child’s unique needs are always met.

    The good news is that there are a number of estate planning tools available to help you protect your child’s interests and provide for their needs, both now and in the future. Even better, these tools can be customized to suit the level of care your child requires, regardless of their level of independence or functioning. Here are three essential tools that every parent of a child with special needs should consider.

    01 | Ensuring A Lifetime Of Care Through Guardianship

    Without proper legal planning, you lose the ability to make decisions for your child when he or she turns 18. Guardianship is a legal relationship ordered by a court that gives someone the authority to make decisions for their adult child if they aren’t able to do so for themselves. With court guardianship, you can name yourself or someone you trust to have the authority to make decisions about your child’s medical care, education, living arrangements, and more. 

    Guardianship is a crucial tool for parents of a child with special needs and is absolutely necessary if your child has challenges that prevent them from making decisions or taking care of themselves independently. Guardianship is an important step in ensuring that your child’s needs are always met.

    Why You Shouldn’t Wait Until Your Child is Near Adulthood

    Even if your child isn’t near the age of adulthood, it’s important to nominate a legal guardian now in the event that you pass away or become incapacitated before your child turns 18. Without your nomination, your child may be left without the care of someone you trust, and the decision of who will care for your child will be up to a court that doesn’t know your child or their unique needs. Thankfully, we’re experienced in nominating guardians for minors and adults, and can walk you through the process of nominating a guardian now, and how to finalize that nomination when your child nears adulthood. We can also help you name short-term legal guardians who can care for your child on a short-term basis if you’re traveling or in the event of an emergency.

    02 | Be There For Your Child with Powers of Attorney

    While not appropriate for all people with special needs, powers of attorney are another important legal tool for parents. Whether your adult child is neurotypical or has special needs, it’s important that you retain some ability to make decisions for them in case they ask for your help or aren’t able to make decisions on their own.

    If your child is high-functioning and able to live independently, powers of attorney may be an appropriate tool to support their care. Through powers of attorney, your adult child can grant you the ability to make financial or medical decisions for them, such as scheduling doctors’ appointments, paying bills, or signing a rental agreement. Your child can also choose whether these powers make it possible for you to act on their behalf at any time or only in the event of their incapacity. Plus, powers of attorney can be customized to meet your child’s specific needs and wishes, ensuring that their care and well-being are always a top priority while still respecting their autonomy and independence.

    03 | Protect Your Child’s Financial Future with a Special Needs Trust 

    Finally, every parent of a child with special needs should consider creating a special needs trust to protect their child’s financial security. This type of trust is designed to provide extra financial support for your child while ensuring that they remain eligible for much-needed government benefits such as Medicaid and Supplemental Security Income (SSI). In fact, giving money directly to a child with special needs can actually cause them to lose their government benefits unless that money is provided to them through a special needs trust.

    A special needs trust can be used to pay for a wide range of needs, including living expenses, household items, health care, and more. And, even better, a special needs trust can be drafted so that you incentivize the people you’ve named as guardians to care for your child the way you are currently caring for them. For example, you may include instructions to financially reward caregivers who take your child to dinner or the movies, so caregivers are properly motivated to provide the kind of care you would naturally, but others may not after you’re gone. Knowing you’ve provided financial incentives for your child to have companionship and care is something many of our clients deeply appreciate.

    Ensuring Your Child Is Eligible For Government Aid

    In order for your child to remain eligible for government aid while receiving funds from a special needs trust, the trust must follow a set of regulations and reporting requirements that vary by state and can be difficult to understand. That’s why it’s crucial to work with us to develop a special needs trust that meets these requirements while being perfectly suited to your child’s unique needs. 

    Your Trusted Advisor When Planning for a Child with Special Needs

    We understand that every child with special needs is different, and that’s why we offer a personalized approach and a comprehensive range of estate planning services, including special needs trusts and legal guardianship nominations, to create a plan that’s unique to your child. If you aren’t sure where to start or what your child may need now and in the future, contact us today at (650) 600-1735. We’ll walk you through your unique situation and develop a plan that ensures your child with special needs has the physical, financial, and emotional support they need now and for years to come.

    This article is a service of Jeannette Marsala, Personal Family Lawyer. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session, during which you’ll get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.

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