As important as early intervention is to the health and wellbeing of your child, so is early attention to creating a financial strategy for your family.
“Parents with a child who’s recently been diagnosed with a life-changing injury, illness, or condition has little time for other concerns,” acknowledges Chadwick Noyes, CLU, ChFC, ChSNC, a Special Care Planner1 with Hoopis
Financial Group2 in Chicago, Illinois, a general agency of Massachusetts Mutual Life Insurance Company (MassMutual). “However, there are financial issues they may want to address sooner rather than later. While it may seem difficult to find the time, doing so may actually provide some peace of mind.”
Why a strategy? And why now? If you’re a parent in this situation, you want to provide the best care for your child. Where do you turn? What will medical care, therapy, equipment, home renovations, education, and other necessities
cost? How will these costs and the demands on your time affect others in the family? What happens if you and your spouse die or, for some other reason, you can’t provide personal and financial care for your child with special needs?
All of these concerns are reasons for a financial strategy. Taking some initial steps now, and working on your strategy over time, can help ensure the financial security of your entire family:
• for yourself and your spouse, now through your retirement years,
• for your child with special needs, throughout his or her lifetime, and
• for other children you may have, at least through college (and beyond, if you choose), including leaving all your children an inheritance.
“When you meet with a financial professional, such as a Special Care Planner, who’s specifically trained to
work with families like yours, the first thing we’ll do is have a conversation,” says Noyes. “Your days may feel unpredictable however discussing your current needs, your child’s future potential in life, and your long term
hopes for your family may help to alleviate your concerns”. We’ll think about how we can help you meet those needs and goals, then suggest some first steps for you to consider, especially what we might do to ensure your child’s continued care if something happens to you.”
One great starting point is to complete a Letter of Intent3. In a Letter of Intent, you document personal, medical, educational, and social information about your child. “Gathering that information together in one place helps you feel less overwhelmed,” says Noyes. “It not only helps you by having doctors’ contact info, lists of meds, and other often-needed facts at hand, but anyone who may care for your child will have that info, too.”
Learn about government benefits
Another first step is determining whether or not your child is eligible for any federal or state Social Security benefits or programs4 now or in the future, such as Supplemental Security Income, Social Security Disability Insurance, Medicare or Medicaid, health care at facilities managed by state health agencies, Extra Help prescription coverage,
and the State Children’s Health Insurance Program. Additionally, your state may offer waiver programs based on specific types of disabilities. Contact your local Social Security office, find info on www.ssa.gov, or use the Benefit Eligibility Screening Tool here: http://ssabest.benefits.gov/.
Begin to create your financial strategy
Here are some elements of a financial strategy to consider. Your financial professional can help you determine if these or other options might suit your needs and can help you prioritize what to do first, depending on your family’s particular situation and goals.
Review all current policies, accounts, and wills – It’s important to check the beneficiaries (named/primary and contingent/secondary) on any insurance policies, savings or investment accounts, employee benefits, pensions, and wills, especially if your child is or could be eligible to receive government benefits that are income/asset based (inheriting money and exceeding income limits may cause disqualification).
Reduce debt and increase savings – “Plan some time to review your financial status.,” suggests Noyes, “Consider paying off credit card debt, reviewing cash flow, and determine the best ways to save discretionary income, begin or review your retirement plan, and saving for children’s college. “If you’re eligible for a 401(k) plan through your
employer, learn how the employer match works and take full advantage,” says Noyes. “If you have credit cards with high interest rates, you may consider paying down the debt, then save for retirement. We can help you understand which tactic is most important to do first, and we’ll review your financial strategy periodically for readjustments.
We can even help you create a budget for your family.”
Wills – “A will is so much more than a way to distribute your property,” says Noyes. “It can also include, for example, your intent for guardianship of children, medical directives, and a durable power of attorney.” When you have a child with special needs, having a properly written will is essential.
Life insurance – There are many types of insurance policies, each suiting specific purposes. A Special Care Planner can help you understand each type, which one(s) might meet the needs of your family, and what policy amounts are suitable. “Life insurance might help you meet your vision for your child’s support after you die,” explains Noyes. “For instance, the proceeds can provide for a future caregiver or guardian to use to provide care for your child. However, how you make those funds available is critical to ensuring the money isn’t used improperly.” Use financial and legal professionals who are skilled in serving people with special needs to ensure your intent is met.
Disability income insurance – If couples who have a child with special needs are both employed, at some time they may wonder if one spouse should stay home with their child. Whether they decide they can manage on one salary or realize they’re dependent on both, disability income insurance is worth considering. It can provide an income when a worker is ill or injured and can’t work. It may be available as an employee benefit and can also be purchased
Guardianship – Eventually you’ll want to give serious thought to a future caregiver for your child. Who would make the best guardian? Do you want more than one guardian, perhaps one person to manage personal care and another to manage finances? Is the person you choose willing or able to accept the responsibility? What legal and financial measures might you take to ensure your child is cared for in the way you wish?
Special Needs Trust – Establishing a special needs trust for your child may help to ensure that his or her eligibility for government benefits aren’t jeopardized. It also ensures you have funds to pay for certain things government benefits wouldn’t cover. But trusts can be complicated and laws vary by state, so it’s important to work with an
attorney who’s skilled in serving the special needs community. A Special Care Planner can explain the many ways a trust might be funded.
Build your support system
“When you’re new to the world of special needs, it’s important to take some time to understand all you can about your child’s diagnosis,” Noyes suggests. “Confide in your friends and family as well, and start to get a feel for which ones will be truly dependable. Talking with other couples who face similar challenges can also be reassuring. They may be able to share tips, direct you to organizations in your region that can be helpful, and offer suggestions about
medical providers, therapists, and suppliers in the community. Our SpecialCare program has built a resource network of professionals for exactly these reasons.”
Prepare for your family’s future
Find a financial professional who has special needs experience, such as a Special Care Planner. They know what questions to ask you to get you on the right course, and their network is wide, so they can lead you to others who can also help. Remember, early intervention regarding your family’s financial strategy can provide peace of mind
throughout your lives and help you reach your short and long term goals.
1 The Special Care Planner, a title used by MassMutual financial professionals, who have received advanced training and information in estate and tax planning concepts, special needs trusts, government programs, and the emotional dynamics of working with people with disabilities and other special needs and their families. The certificate program was offered by The American College in Bryn Mawr, PA, exclusively for MassMutual financial professionals. Additionally, a designation of Chartered Special Needs Consultant (ChSNC), which evolved from the certificate program, is now offered through the American College for financial professionals. MassMutual financial professionals who have completed the certificate program, or received the ChSNC designation can use the
Special Care Planner title.
3 You can request a free Letter of Intent template from MassMutual www.massmutual.com/specialcare
4 You may want to read “Government Benefits for Children with Special Needs” (Exceptional Parent, July 2012) archived on this website: www.eparent.com
* The Special Care Planner, a title used by MassMutual financial professionals, who have received advanced
training and information in estate and tax planning concepts, special needs trusts, government programs, and the
emotional dynamics of working with people with disabilities and other special needs and their families. The certificate program was offered by The American College in Bryn Mawr, PA, exclusively for MassMutual financial professionals. Additionally, a designation of Chartered Special Needs Consultant (ChSNC), which evolved from the certificate program, is now offered through the American College for financial professionals. MassMutual financial professionals who have completed the certificate program, or received the ChSNC designation can use the Special Care Planner title.
A Special Care Planner through MassMutual’s SpecialCareSM program can assist parents in drafting Letters of Intent and can help make a difference in the quality of life for an individual with special needs, their caregiver and other family members. Through SpecialCare you will learn valuable financial strategies, identify financial strategy solutions, access vital information, and meet certified specialists who will work with you and your professional advisors – your banker, accountant or financial planner, lawyer, social workers and health care providers – to review your financial picture and offer options to fit the needs of each situation. For more details, visit MassMutual’s website at http://www.MassMutual.com/specialcare, or call 1-(800)-272-2216.
Founded in 1851, MassMutual is a leading mutual “http://www.massmutual.com” life insurance company that
is run for the benefit of its members and participating policyholders. The company has a long history of “http://www.massmutual.com/aboutmassmutual/financialinfo/strength” financial strength and strong performance, and although dividends are not guaranteed, MassMutual has paid dividends to eligible participating
policyholders consistently since the 1860s. With “http://www.massmutual.com/productssolutions/individualsfamilies/producttype/lifeinsurance/wholelife” whole life insurance as its foundation, MassMutual provides products to help meet the financial needs of clients, such as “http://www.massmutual.com/productssolutions/individualsfamilies/producttype/lifeinsurance” life insurance, “http://www.massmutual.com/productssolutions/individualsfamilies/producttype/disabilityincome” disability income insurance, “http://www. massmutual.com/productssolutions/individualsfamilies/producttype/longtermcare” long term care insurance, “http://www.massmutual.com/retire/plansponsors” retirement/401(k) plan services, and “http://www.massmutual.com/productssolutions/individualsfamilies/producttype/annuities” annuities. In addition, the company’s strong and growing network of financial professionals helps clients make good financial decisions for the long-term. MassMutual Financial Group is a marketing name for Massachusetts Mutual Life Insurance Company (MassMutual) and its affiliated companies and sales representatives. MassMutual is headquartered in Springfield, Massachusetts and its major affiliates include: Babson Capital Management LLC; Baring Asset Management Limited; Cornerstone Real Estate Advisers LLC; The First Mercantile Trust Company; MassMutual International LLC; MML Investors Services, LLC, Member “http://www.finra.org/” FINRA and “http://www.sipc.org/” SIPC; OppenheimerFunds, Inc.; and The MassMutual Trust Company, FSB.
The information provided is not written or intended as specific tax or legal advice. MassMutual, its employees and
representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their
own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning
team, including their own personal legal or tax counsel.