Financial Strategies for Children with Special Needs
Every family’s financial strategy must account for their unique circumstances, especially if you’re caring for a child with special needs. Parents must consider both present and future needs, including a future where you’re no longer managing your child's care.
When Life Takes an Unexpected Turn
A child's diagnosis can occur at various stages, from prenatal visits to late childhood. Regardless of timing, your world changes the moment you learn about it. Initial actions often focus on the present, involving appointments, therapies and building support networks. However, long-term planning is equally crucial at an early stage.
Whether the diagnosis is physical, developmental, genetic or unknown, gathering reliable, evidence-based information is essential. Connecting with other parents through healthcare teams or online groups can provide support and valuable advice. Once settled, focus on ensuring your child’s future needs, including financial, legal and emotional support.
This can include:
- Address Financial and Legal Concerns – Beyond typical preparations, parents of children with special needs must address immediate and long-term financial issues, possibly requiring home healthcare, respite care and adjustments to household income
- Name a Guardian and Trustee – Choose a guardian for your child’s care and a trustee to manage their finances, ensuring responsible handling of funds
- Write a Letter of Intent – Document your child’s history, routines, medication schedules, likes, dislikes and healthcare contacts and make sure you update it on a regular basis
- Establish a Special Needs Trust – Protect your child’s eligibility for government benefits by setting up a trust to manage assets without disqualifying them from aid
- Educate Family Members – Ensure family members understand not to leave assets directly to your child, but to the special needs trust
- Build Your Savings – Inventory your assets, liabilities and cash flow. Utilize FSAs or HRAs if available, but avoid putting savings in your child's name
- Write a Will – Specify asset distribution to the special needs trust and select a guardian to avoid jeopardizing your child’s eligibility for benefits
Governmental Benefits
Children with disabilities may qualify for SSI, Medicaid and other federal or state benefits. Check eligibility and application processes, which vary by state, and consult local resources for guidance.
Educational Rights
Federal law ensures children with special needs receive appropriate public education. You must advocate for your child’s rights to services and accommodations. Eligibility criteria and available services vary by state.
Preparing for both present and future needs is essential for families with children with special needs. It’s important to know how to reach your financial goals for yourself and your family. If you have questions regarding personalized care your child’s needs, we have two Wealth Advisors who are passionate about working specifically with families who have children with special needs. Heath Burch and Scott Adams are both Chartered Special Needs Consultants® (ChSNC) who founded the Special Needs Planning Center in Kansas City.
