It’s unfortunate, but it happens. One person in a marriage/relationship leaves because he or she can’t deal with the demands of living with special needs. If you’ve been left to cope on your own, there are some financial matters you should consider. This article will focus on helpful information for adults who have special needs whose spouses have abandoned them.
“The first and most important thing to do,” says Brenda Mahon, a Special Care Planner (1) with North Texas Financial Group2 in Fort Worth, Texas, a general agency of Massachusetts Mutual Life Insurance Company (MassMutual), “is to meet with a financial professional and an attorney who work with people with special needs. They’re most acquainted with financial options and laws that pertain to special needs and can help you create a strategy that will best suit your needs. It’s important, at a time like this, to feel like you have someone on your side, experts who can help you find solutions you may not even know are out there.”
If your relationship will end in divorce, it’s important to also include a divorce attorney on your team of experts. Together, they can help ensure that any alimony payments or other divorce settlements are sufficient and won’t affect your eligibility to receive government benefits now or in the future. Every situation is different, as is every strategy. You’ll need to
evaluate your own financial picture: the little things and the big, how it looks today, and what you want for your future. Here are some things to consider now and discuss in further detail with your financial professional and attorney.
“If you haven’t already done so, apply for Social Security benefits,” suggests Mahon. “If you were previously denied benefits, appeal, especially if your income has diminished since your spouse has left.” You may qualify for Social Security Disability Insurance (SSDI) based on your inability to work or Supplemental Security Income (SSI) based on your needs and income.
“Applicants are often denied when they first apply,” explains Mahon. “An attorney can help with the
application or the appeal to improve your success in getting approved.” Keep in mind that once you’re approved, benefits are paid retroactively to the date of your application. You’ll receive a monthly
monetary benefit and be eligible for Medicare.
If you don’t already have health insurance, Medicare can help pay medical bills so you can use your money for other expenses.
More government benefits
Here are more options for financial assistance. Talk to a Social Security Administration (SSA) representative for more information.
Retirement benefits: When the time comes, you may be eligible for retirement benefits based on your spouse’s earnings, even if you’re divorced, and even if you subsequently remarried and that marriage
ended (by divorce, death, or annulment). If you’ve never worked or your spouse’s earnings were higher than yours, think about this option. Learn more here: www.socialsecurity.gov/retire2/divspouse. htm.
Disabled Adult Child (DAC) benefits: If you were disabled (by SSA’s definition) prior to age 22 and a parent is deceased or receives retirement or disability benefits, you may qualify for DAC benefits. Again,
this benefit may be higher than SSI, SSDI, or retirement benefits you might qualify for based on your own records.
Waiver programs: If you qualify for Medicaid, Social Security offers a variety of programs (which vary by state) that waive certain Medicaid rules related to services ordinarily available only in nursing home settings, so you may receive them in your home or from providers in your community. These programs have long waiting lists. Learn what your state offers and apply right away.
Other benefits: Receiving SSI or SSDI (or your income level) may qualify you for other federal or state government benefits, such as:
- Ticket to Work, a program that helps SSDI recipients get back to work,
- Supplemental Nutrition Assistance Program (food stamps),
- fuel assistance to help with home heating costs, which may also qualify you for other utility bill rate reductions, or
- subsidized housing that provides low-cost rentals. Check the SSA’s and your state’s website, or talk with someone in your state’s transitional services department.
Learn what programs and services Social Security has to offer and how the system works. You’ll find useful publications here: www.ssa.gov/pubs/index.html.
Consider a trust
If you get SSI, receiving money, such as being beneficiary on a life insurance policy, could cause you to lose your benefits. Protect your benefits by establishing a trust. Ask those who might name you in a will or as beneficiary of life insurance policy to name your trust as the beneficiary instead. A Special Care Planner or a financial services professional with the Chartered Special Needs Consultant1 designation and an attorney with special needs expertise can help you understand the various trusts and explain how they’re funded. The attorney can write the trust so it works with your complete financial strategy and laws related to special needs.
Did you purchase life insurance policies? If you are the owner of a policy insuring your spouse’s life, only you can change the beneficiary. Think about other policies you may have. Do you own a policy on your own life? Do you have any policies from previous employment, through your bank (some offer discounted policies to their account holders) or other organization (such as a professional affiliation, club, etc.)? Who owns and pays for these policies? Who can change the beneficiaries? Remember, receiving the death benefits of a life insurance policy could affect your eligibility for government benefits, as explained in the previous section.
Retirement accounts, pensions, and other bank accounts
Do you have an IRA or pension plan? Some have early withdrawal options for people who become disabled. “After applying for Social Security benefits, this is the next thing I’d recommend for someone
who can’t earn an income,” says Mahon. “No early withdrawal penalties will apply, but if it’s an account that was funded with pre-tax dollars, such as an untaxed portion of earnings deducted by an employer, you’ll have to pay tax on the distributions you take.” Another thing to keep in mind is how state laws affect jointly-owned bank and investment accounts. Different states have different rules on how much of the joint accounts you are entitled to (www.211us.org, not available in all regions) to chat with someone who knows what your community offers.
Guardianships, medical directives, and powers of attorney
If you can’t fully care for yourself, you may want to ensure you have the help you need when you need it. One way is to name a legal guardian for yourself, specifying the level of authority/responsibilities that person would have regarding your personal care, medical and legal decisions, and your home and community life.
“That may be more than you need, though,” says Mahon. An advanced medical directive (health care proxy, living will, or medical power of attorney) and/or a financial power of attorney may make more sense, allowing you to retain more control. You can specify what authority you give and when it begins and ends. “Using a medical directive also helps you circumvent privacy rules that would prevent medical providers from disclosing information about you, including whether or not you’re a patient of a facility,”
says Mahon. “That could be particularly troublesome if you’re unconscious or unable to communicate, but would want a loved one to be there to help.”
Letter of intent
Another way to help you get the care you need is to complete a letter of intent, a document containing everything you would want another person to know if he or she needed to step in to help you – either under planned circumstances or in an emergency. You can request a free letter of intent template here: www.massmutual. com/planningtools/additional-resources/special-needs/special-care/resources.
Evaluate your network. Who are your trusted friends? Who can you depend on when you need them? What friends and family members would help if only you asked? Which have excuses when you do?
Also, many civic and religious groups (such as the Knights of Columbus, Shriners, Lion’s Club, and others) can help in a variety of ways (offering transportation, building ramps or making other accommodations in your home, providing meals or cleaning services, etc.). Find out what’s available in your community. Begin online and talk to people who are members. Or dial 2-1-1 (www.211us.org, not available in all regions) to chat with someone who knows what your community offers. You’re in a difficult situation, but you aren’t alone.
For more information regarding benefits provided by Medicare or Medicaid (Medi-CAL in California) visit www.cms.hhs.gov. Medicaid guidelines vary by state. Contact your local Medicaid office for details.
For information about SSI go to http://www.ssa.gov/ssi/. For more information about SSDI go to http://www.ssa.gov/pgm/links_disability.htm. Information is available by telephone, mail, in person at an office. The toll-free number is 1-800-772-1213.
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.
* 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
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