Archive

Special planning critical for special-needs individuals

Advisers have more clients that have children with disabilities than in the past. As a result, they need to understand the financial planning issues that those families face and become skilled in the use of special-needs trusts, a legal expert said today at the annual convention of the National Association of Personal Financial Advisors in Washington.

Advisers have more clients that have children with disabilities than in the past.
As a result, they need to understand the financial planning issues that those families face and become skilled in the use of special-needs trusts, a legal expert said today at the annual convention of the National Association of Personal Financial Advisors in Washington.

“Anecdotally, we are seeing more clients with children with developmental disabilities and autism,” said lawyer Sheila Mints, a partner with Coughlin Duffy LLP of New York who specializes in taxation, estate planning and trusts, including special-needs trusts.

That is not surprising as the Atlanta-based Centers for Disease Control and Prevention estimates that 1 in 150 children are born with some kind of autism, the fastest growing developmental disability, according to the Autism Society of America of Bethesda, Md.

The biggest financial challenge for parents occurs when the child turns 21, Ms. Mints said.

“There’s not much [work] for them,” she said. “There are no sheltered workshops anymore. Many people with disabilities want to work. Also at that time, the parents start to age, and they may need more care themselves.”

Housing can be another challenge, Ms. Mints told the group.

It is difficult to get into group homes, she said. “In the New York and New Jersey area, you could be on a waiting list for 10 to 12 years easily.”

All these factors make financial planning critical, Ms. Mints said.

Parents must make sure they have all the life insurance, disability insurance and long term care that they can afford, she said.

The next step is to set up a special-needs trust, which must be done correctly so that the special-needs individual can qualify for public benefits as well, Ms. Mints said.

Naming a trustee is another critical issue for parents, she said.

“The person is named for the life of that [special-needs] individual,” Ms. Mints said. “They need to be hands on. I also suggest to clients that they name a corporate trustee as a backup or successor to the trustee.”

More than 500 advisers attended the three-day conference of the Arlington Heights, Ill.-based organization of advisers.