If you have a disabled adult child, you know that coming up with a solid financial plan requires serious consideration. You want to make sure your child has the resources to meet basic needs without depleting your finances.
You also need to do your best to provide for your child if you die first.
The role of Social Security
An article in Forbes describes the importance of keeping a disabled adult child eligible for Supplemental Security Income through the Social Security Administration. To make this happen, you should keep a close watch on how much money is in your child’s bank account. Having too much money in the account could negate the possibility of receiving funds from SSA.
A lump-sum inheritance in the name of your child could have negative consequences for obtaining SSI. For this reason, a properly drafted and administered trust could allow the disabled adult child to receive money from your legacy as well as funds from SSA.
The role of sound financial planning
As a parent of a disabled adult child, you face many financial challenges. If you have other children, the task becomes even more complicated. You don’t want to alienate your other children or short-change them when it comes to leaving an inheritance.
Fortunately, tools exist for ensuring your disabled adult child has the necessary resources at all times. Special needs trusts can make sure money becomes available when the child needs the money. You can fund the trusts through a variety of income sources.
A survivorship life insurance policy often works well for many families. Social Security benefits can also play an important role in your financial plan.