Parents of children with special needs know that it is more difficult to raise their children than it is to raise other children. That is not to say that it is worse. It just has more difficult challenges that need to be overcome. Estate planning when you have children with special needs is no different. It is more difficult.
One of the difficulties is that children with special needs often need so much financial assistance that their parents do not have many financial assets to leave for the children’s care. This causes many families to worry how they can make sure their special needs children have the necessary monetary support if something happens to the parents. One solution that many come up with is to take out a life insurance policy and name the special needs child as a beneficiary. This is a big mistake. The money from the policy can be used to care for the child, however, it could also disqualify the child from receiving government assistance.
If you have a child with special needs, talk to an estate planning attorney about a supplemental special needs Trust. If created properly, it will not disqualify your child from receiving necessary government assistance.