Estate Planning for Parents with Children with Physical Disabilities

Estate planning is crucial for parents of children with physical disabilities, as it ensures that their child’s financial, medical, and personal needs are met even after the parents are no longer able to provide care. Proper estate planning helps secure the child’s future by preserving eligibility for government benefits, setting up financial resources, and appointing trusted caregivers.

One of the most important aspects of estate planning for a child with a disability is establishing a special needs trust (SNT). This type of trust allows parents to set aside funds for their child’s future expenses without jeopardizing their eligibility for essential government programs such as Medicaid and Supplemental Security Income (SSI). If a child inherits money outright, they may exceed the financial limits for these programs and lose crucial benefits. A properly structured SNT prevents this by holding assets in a way that supplements rather than replaces government aid.

Another critical component is appointing a guardian or conservator. If the child will require lifelong care, parents should designate a trusted individual to make legal, financial, and medical decisions on their behalf. Without clear legal instructions, courts may appoint a guardian who may not align with the family’s wishes.

Parents should also draft a letter of intent, a non-legal document outlining their child’s medical history, care preferences, daily routines, and other personal details that will help future caregivers provide consistent support. Additionally, life insurance can be a valuable tool to provide financial security for the child after the parents’ passing.

By proactively creating a comprehensive estate plan, parents can ensure their child with a physical disability is well cared for in the long term, reducing uncertainty and protecting their well-being after they are gone.