How Your Loved One Could Benefit From A Special Needs Trust

There are many individuals who have loved ones who may need extra care because of a disability or mental challenges.

If you find yourself relating to this statement, it is crucial to ensure that your loved one has the financial resources to be able to receive necessary care as well as meet daily life needs, especially in the event that you suddenly pass; however, you may also know that there could be some complications with government benefits by simply gifting them money.

This is where trusts may prove useful to you if you want to help with your loved one’s financial security without jeopardizing their eligibility and receiving of government benefits. A special needs or supplementary trust may allow you to provide funds for certain necessities.

Leaving a lump sum of money to your loved one in your will means that the money becomes an asset of the beneficiary. Government benefits and programs may see the money you left for your loved one and, as a result, determine that your loved one does not qualify for needed benefits. So even though you thought your chunk of money could help provide security for loved one, your gift could prove less helpful than you intended.

Trust assets fix this dilemma because they do not go into eligibility consideration for government benefits and programs. This is because an outside individual manages the trust.

This trustee has control over the funds in the account; therefore, those funds do not technically belong to the beneficiary to use for whatever he or she pleases. Though it may already be obvious, it is important to note that the trustee should be a responsible and trustworthy individual.

Other Advantages of Trusts

As mentioned, a trust could help protect your loved one’s eligibility for government benefits. Even if the loss of benefits is not a concern for you or your loved one, a special needs trust could still prove useful. This fund sets aside money for specific needs, and could also be very useful in the event of an accident or emergency.

Having your money set aside in a trust also offers other protections like keeping your money out of the hands of other individuals in the event that the beneficiary become involved in a lawsuit.

Because this type of trust may benefit each individual differently, it is important to find out more information on the exact uses for which you could utilize a special needs trust.

You may want to ensure that the type of trust fits your circumstances, because the use of this type of trust could have various repercussions. Discussing your desires, concerns and options with one of our experienced attorneys may help you better understand how your loved one could potentially benefit from a trust.

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