Maryland residents who have guardianship over someone with developmental disabilities have a lot to consider when it comes to estate planning. A good way to make sure that your loved one has financial security after you’re gone is by setting up a special needs trust.
What is a special needs trust?
A special needs trust – also referred to as a supplemental needs trust – is a trust that is set up to financially support a person with developmental disabilities. One of the key features is the trust is set up in such a way that it doesn’t negatively impact any government benefits that the person is receiving, like Medicaid or Supplemental Security Income (SSI).
How does a special needs trust work?
A special needs trust will give out money to the trustee every month, usually just under the amount that would impact their benefits. This money is meant to be supplemental income to their benefits and cover things like clothes, phone bills, etc.
Some special needs trusts can’t be accessed by creditors or lawsuit winners, since it’s in a protected trust. Having the trust set up also protects the beneficiary from being taken advantage of financially.
How to set up a special needs trust?
Someone looking at setting up a special needs trust will be asked to think about how long they want the money to last, how much they want their loved one to receive monthly, and who they’ll appoint as trustee. You’ll also need to appoint a trustee to act in your loved ones’ best interests and help disperse the money.
It can take time to set up special needs trusts for your loved one. But you can have some peace of mind knowing they’ll be supported after you’re gone.