One in seven Americans lives with a special need that interferes with his or her life activities. Whether it is physical, mental, developmental or emotional, the idea of caring and providing for a special needs child well into adulthood can feel quite overwhelming at times.
According to recent statistics from the NYC Department of Health and Mental Hygiene, the prevalence of men and women who require living assistance due to their special needs and who are below the age of retirement comprise 3% to 8% of the city's population. In a city of over 4.8 million people between the ages of 19 and 64 years alone, this amounts to roughly 385,000 residents. Alongside them are caregiver parents who may feel at a loss as to how to meet the special needs of their adult children as they themselves begin to require increasing assistance in their daily lives.
Thinking about and planning for the future is hardly ever an easy task. The difficulty is even greater if your thoughts and plans extend to the future security of your adult children who remain dependent on your care.
If this sounds like you, there is no better time like today to pick up the phone wherever you are and inquire about the legal tools available to you under New York law. They serve to bring peace of mind and future security to your dependent loved ones.
Your first step begins with speaking to an estate planning attorney. Below is a Top 10 List of relevant topics you might want to inquire about:
#1 Medicaid eligibility and Supplemental Security Income (SSI)
Ask your estate planning attorney how to set up your adult child's present and future assets so that future gifts and/or transfers do not interrupt or jeopardize his or her continued eligibility for these critical government benefits. You may also want to look into finding a disability insurance quote online for when they become an adult. If their disability means they may have to spend periods of time unable to work then disability insurance may help in this regard. Ultimately it depends on the nature of the disability.
#2 Special Needs Trust (Revocable versus Irrevocable)
A way to provide additional funds for your adult child as needed while ensuring that the funds (1) are being properly managed, and (2) will not disrupt your adult child's continued eligibility for government benefits such as Medicaid or SSI.
#3 First-party versus third-party trusts
Which one is right for you? A first-party trust holds the beneficiary's assets during his or her lifetime, and thereafter, whatever funds remain will be reimbursed to the government for any benefits that had been paid to the beneficiary in the past. A third-party trust is given to a trustee for the benefit of the beneficiary over the course of the beneficiary's lifetime. Thereafter, what remains in the third-party trust can be distributed to another beneficiary such as a surviving sibling or other loved ones.
#4 Last-to-Die Life Insurance Policies (also known as Second-to-Die or Survivorship Life Insurance Policies)
You as the policyholder would pay an annual premium for a certain amount of life insurance, which will be paid out only after the lifetimes of both you and your spouse. Ask your estate planning attorney about the specifics of purchasing such policies and whether it makes sense in your situation to purchase such a policy in conjunction with a special needs trust.
#5 Health care Directives
These documents allow you to appoint someone to act on behalf of your adult child as his or her agent with the authority to make decisions concerning health care or treatment. In special needs circumstances, a health care directive can include specific instructions regarding medications and medical history as well as particular needs, wishes and preferences.
#6 Letter of Intent
A general set of guidelines for your adult child's future caregivers and trustees, as told by the caregiver who knows your child best: you.
#7 Long-term care insurance
A way for you to set aside funds to help cover costs in the event of your adult child's illnesses, as well as to protect such funds from being lost in the event of unplanned future expenses, such as, for example, nursing home care.
#8 Lump sum inheritances and other gifts and transfers
Ask your estate planning attorney about the do's and don'ts of gifts and transfers to your adult special needs child.
#9 ABLE accounts
The Stephen Beck, Jr. Achieving a Better Life Experience (ABLE) Act of 2014 allows those with disabilities to save for qualified disability expenses without the risk of losing their benefits from assistance programs like SSI and Medicaid.
NY ABLE accounts, administered by the Office of the New York State Comptroller, give earnings the ability to grow tax-deferred, and allow savings to be withdrawn tax-free for qualified expenses, which include education, health and wellness, housing, transportation, legal fees, financial management, employment training and support, assistive technology and personal support services, among other expenses).
#10 Family Opportunity Mortgage
Fannie Mae offers the best mortgage interest rates to purchasers of primary residences who intend to be the owner/occupant of the new home. Through the Family Opportunity Mortgage, Fannie Mae extends this incentive to parents who want to purchase homes for their physically handicapped or developmentally disabled adult child, if the child is unable to work or does not have sufficient income to qualify for a mortgage on his or her own.
Every family's situation is unique. There are many ways to secure the future of your adult child with special needs. It can be as simple or as elaborate as you feel is appropriate. The important thing is that while you are still able to plan, by having read this article you have already begun to do so. Once you take that next step and are ready to ask questions, you can begin to relieve yourself and your loved ones of the inevitable worries that come with caring for the adult children you love who still depend on you every day
Law Offices Of Roman Aminov 147-17 Union Tpke, Flushing, NY 11367 (347) 766-2685
Contact Roman today for award winning special needs estate planning in Queens or NYC.