Special Needs Financial Planning
Develop a special needs financial planning roadmap.
Develop a clear vision of how you want your dependents with special needs to live.
- What kind of life do you envision?
- How will he/she live without you?
A Letter of Intent can help you summarize your goals.
Determine the cost for care for the lifetime of your dependents with special needs.
- Government programs or funding received today may not be available in the future.
- Costs of current services may not be covered if a child is no longer part of the educational system.
Your special needs financial planning should provide for a dependent’s care after your death.
- Complete a will.
- Appoint a guardian.
- Complete a letter of intent for future caregivers.
Review the Assess Your Situation checklist to make sure you’ve covered living arrangements, care, education, and government benefits in your special needs financial planning.
Work with a financial professional and your legal counsel to ensure you have the necessary documents drafted with the appropriate wording for your dependents with special needs.
Important Documents and Tools
It’s important to work with an attorney with special needs expertise who can carry out your wishes and ensure important documents are completed.
These may include:
- Letter of Intent
- Durable Health Care Power of Attorney
- Durable Power of Attorney
- Living Will
- Power of Attorney
A Northwestern Mutual representative can provide you with a copy of the Pocket Resource Guide. The guide contains information for dependents with special needs and their families and was developed in partnership with Exceptional Parent.
- Social Security Online
Under the section "Information for" click on "kids." Benefits for Children with Disabilities provides other useful information.
Disability-related information and programs: Civil rights, community life, education, employment, housing, health, benefits, technology and transportation.
An inheritance or gift from a family member may cause problems for dependents with special needs. Disqualification from federal benefits such as Supplemental Security Income (SSI) and Medicare may occur with even a small inheritance.
A special needs trust, if drafted properly, can help eliminate disqualification and provide financial support beyond government benefits for dependents with special needs. A trustee must manage the assets of the trust according to the trust arrangement.
- Allows family members to leave money or property to the trust rather than an individual.
- Provides extra and supplemental care, maintenance, support and education beyond local, state or federal programs.
- Grandparents may use a life insurance policy to set aside funds payable to a trust for special needs grandchildren.
Your special needs financial planning should include all school costs, including disability-related educational expenses.
- Individualized Educational Program (IEP)
The federal IEP program includes transitional planning at age 14 and focuses on skills and services needed to successfully transition from school to adult life.
- Education Funding
There’s no shortage of ways to fund and save for a child’s education. Students with disabilities may be eligible for financial aid, including grants, scholarships and awards.
We Can Help
An Attorney can help prepare what’s called a “supplemental needs” or “special needs” trust. Northwestern Mutual can help you find ways to fund the trust. One option is a second-to-die permanent life insurance policy. It provides much-needed resources at the death of a second parent and is typically lower in cost than a single life policy.
Northwestern Mutual can help you create an appropriate educational funding plan for all your children, including dependents with special needs.
What other financial planning is important for other members of your family?
Northwestern Mutual understands the challenges your family faces. We can help you identify your unique needs and goals and ensure your financial planning includes solutions for all members of your family including those dependents with special needs.