Presented By: Kenna M. Ulbinsky-Yakal

If you’re caring for someone with special needs, you know how important it is to prepare for the future and the possibility that, one day, you may no longer be able to provide the care this person’s needs.

Providing for someone with special needs involves preparing for the long-term needs of a physically or mentally disabled member of the family. Most often the special needs individual is a minor or adult child, but in some cases, planning may be necessary for dependent parents or other relatives. With a special needs adult child such preparation should provide for him/her once his/her parents (the caregivers) become disabled or die. The ability of a child with special needs to function will determine the required level and cost of care.

Caring for a person with a mental illness is generally considered more complicated than caring for a person with a developmental or physical disability, however, each situation is unique and should be considered on an individual basis.

Even when other members of the family, such as siblings, are willing to assume the duties of caregiver, it is still important to provide for the management of assets. A testamentary or Living Trust are examples of vehicles that can be considered for this purpose. Such a trust, sometimes called a “Special Needs Trust,” should:
*Appoint someone to take care of this person’s property and money
*Select a guardian for the individual
*Set out instructions on how he/she is to be cared for
*Ensure, to the extent possible, that he/she will not lose payments or benefits from government agencies
*Integrate the trust with the remainder of the parent’s estate plan to ensure equity among all family members.

Not withstanding the time value of money, survivorship life insurance on both parents could provide a cost-efficient means of funding this trust upon their death. Disability income insurance on a working parent is also something to be considered.

At one time or another during his/her lifetime a person with special needs could receive benefits from, Supplemental Security Income (SSI), Medicare and/or  Medicaid. Keep in mind though, that eligibility for government assistance can be negatively affected by the disabled person’s assets. For example, to be eligible for the SSI benefit, a single disabled person cannot own more than $2,000 in cash and liquid assets. The objective of a Special Needs Trust is to supplement the child’s inheritance, not replace these government programs.

Planning for the future when you’re caring for a loved one with special needs can be overwhelming. A licensed financial services professional can help you determine what approach may best serve your needs.

Adapted with permission of the publisher from Field Guide Online, by Donald F. Cady, Copyright 2007, The National Underwriter Company.

Provided courtesy of Prudential. For more information, contact Kenna Ulbinsky-Yakal. Kenna is an Agent with The Prudential Insurance Company of America’s Penn-Delmar agency located in Newark, DE. Kenna can be reached at kenna.ulbinsky-yakal@prudential.com and 302-224-9340.

Life insurance issued by The Prudential Insurance Company of America, Newark, NJ, and its affiliates. Our policies contain exclusions, limitations, reductions of benefits and terms for keeping them in force. Your licensed financial professional can provide you with costs and complete details. The availability of disability income insurance varies by carrier and state.
IFS-A144338 Ed. 02/2008 Expires 8/11/2010