There are many different components and moving parts to put together when it comes to setting up a special needs trust. You want to make sure the trust you set up gears you and your family towards success. Following are some things you should be considering when setting up a special needs trust to ensure it’s successful in the long run.
Think About Your Goals
Every family is different, so every trust will be slightly different with different end goals in mind. You have to think about what you want the trust to provide for your family and how you’ll reach those goals. Some things to consider include how much money your special needs loved one may need, how long the money needs to last them, how often you want them to receive that money, what needs have to be met with the money, who has control of the assets, and more.
Deciding how you want the trust to impact them and provide for them will help you determine the best way to set up a successful trust for your loved one.
Assign Trustees Thoughtfully
Assigning the right trustees is a vital part of the trust process, as they’re the ones who will help your loved one invest, manage, and disperse all of the funds. The individual or individuals who guide your special needs loved one’s financial usage will need to be trustworthy and reliable. Most of the time trustees are family members, but it will depend on your family and specific situation.
You should have strong trust in the individual or individuals who are picked and their ability to successfully guide the usage of the funds.
Create the Trust Carefully
Creating the actual trust must be done with care and consideration, as the wording on the specific documents is very important. The wrong wording can have very heavy implications, so it’s vital you write exactly what you intend and work with a professional to do so. The wording on the trust can very easily have an impact on the future of your special needs loved one, so you’ll want to make sure it’s done correctly.
Decide and Invest Funds
Once the trust is created, you’ll have to decide how to fund the trust; it is typically done from assets such as investments, life insurance policies, savings accounts, or cash. It’s also an option to designate property to hold in the special needs trust. While it may seem like an obvious step, the funding portion of the trust is one some people may look over or forget.
A trust fund for your special needs child can be set up, but without being funded effectively, it won’t serve much of a purpose.
You must also consider how to invest your funds and what assets you want to put into the trust. This circles back to your initial goals for the trust. What is the nature of the disability and level of medical care of your loved one? What will they need the money for? Do they have other means of acquiring money? These are all things that must be thought about before investing your hard-earned money.
While there is no legal minimum amount needed to put in the special needs trust, it’s suggested by experts that at least $100,000 should be put in.
Work With the Right Team
A trust fund is an extremely vital tool for special needs children. If a trust fund is set up the right way for them, it will make a huge difference in their lives and set them up for success after the passing of their caretakers.
The best way to ensure their trust is set up correctly is to work with special needs trust specialists, as the rules and system are extremely complex and strict. The team at Life’s Plan will guide you through the special needs trust process to ensure whatever you have set up meets the goals and needs of your family.
We understand how overwhelming it is to ensure your child has access to long-term health care. For assistance setting up a special needs trust in Chicago, call our team today.