Perhaps you have a special needs son who is now 18 years of age.
You want to ensure his wellbeing and financial security both now and in the future. What options are available?
Your goal is to set aside funds for the future care of your son without jeopardizing the benefits he currently receives from the U.S. government: Supplemental Security Income along with Medicaid. Government regulations require that he have no more than $2,000 in cash assets, so an inheritance or gift of money would cause the cancellation of his benefits.
Choosing the type of trust
If your son does receive an inheritance or perhaps a personal injury settlement, he can self-fund a Pooled Disability Trust managed by a nonprofit corporation. Otherwise, you can establish and fund a Special Needs Trust in coordination with your estate plan. The money in either kind of trust can go toward transportation, furniture, clothing, education, recreation and the purchase of medical aids and equipment.
Designating trustee and advocate
Once you choose the type of trust that best serves the needs of your son, you must designate a trustee to manage and disburse the funds for his sole benefit. If you establish a Special Needs Trust, you should also expect to designate an advocate who is close to your son and who understands his needs as well as your wishes. The advocate will work closely with the trustee to ensure that the disbursements protect quality-of-life standards for your special needs child both now and in the years to come.