Planning for both is complex, but not impossible.
You have a child with special needs.
You feel torn between providing for the needs of your child and your own retirement and aging.
Your child will likely outlive you.
How can you ensure he or she will be okay without you?
According to a recent Morningstar article titled “Retirement Planning for Special-Needs Families,” you are not alone.
One in every five Americans has a disability.
In fact, some 20 million families have at least one family member with a disability, according to the National Disability Institute.
These individuals face financial demands others do not face.
For example, the cost of caring for an person with autism ranges from $1.4 million to $2.4 million over a lifetime.
Costs are similarly high for other impairments.
But there are rules.
One set covers those who were disabled prior to age 22.
The other applies for those who acquired their disability later in life.
What should you consider when creating a plan for your family?
Quality of life
Vitally important is the safety of the child.
Other significant factors include work, learning and play.
Several factors will contribute to the cash flow needs of the child.
- The specific disability of the individual.
- The capabilities of the individual.
- The level of care the individual requires.
Chances are you will need more cash readily available than families without disabled loved ones.
Be sure your retirement portfolio accounts for this.
If you qualify, government benefits like Medicare and Medicaid can be helpful.
You should also plan to maximize Social Security.
Special needs specific government rules
When it comes to disability, the government often has specific rules and guidelines regarding income and asset limits.
Special Needs Trust
This tool has helped many a family and is critical to your retirement plan.
How your child receives his or her inheritance can jeopardize government benefits.
Be sure your estate planning protects your child.
Proper planning is not simple and should not be attempted alone.
Work with an experienced estate planning attorney who knows your families situation as well as the governing laws.
He or she will be able to create the best plan for your family.
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.
Reference: Morningstar (January 17, 2017) “Retirement Planning for Special-Needs Families”