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Financial Planning for Special Needs Families

By Erik Utzinger

Financial planning for families with special needs often requires a unique approach to ensure that all aspects of the child’s care and future are addressed effectively. Traditional financial planning strategies might not fully cover the intricate needs and could lead to unintended funding and tax issues. At GrowStrong Wealth, we understand these complexities and offer tailored solutions to help you navigate this challenging journey.

The High Cost of Living with a Disability

Caring for a child with disabilities involves substantial costs that can quickly add up. In the U.S., over 14 million children have special healthcare needs, imposing a significant financial burden on their families. For instance, the annual cost for a child with autism averages $60,000, while the lifetime cost for an individual with cerebral palsy can exceed $1 million. These figures highlight the importance of comprehensive financial planning.

Government assistance often covers basic care, but many families aim to provide beyond the essentials to ensure their child's well-being. Additional costs include:
  • Home Modifications: Adapting your home for accessibility.
  • Special Education: Tailored educational programs to support learning.
  • In-home Caregivers: Assistance with daily activities.
  • Housekeeping Help: Managing household chores.
  • Lost Income: Reduced earning potential due to caregiving responsibilities.
Five Considerations When Creating a Plan for Your Disabled Child

1. Understand Needs and Existing Resources
  • Take stock of the equipment and accommodations your child requires.
  • Identify potential government assistance programs, such as Medicaid and Social Security disability benefits, that can support your child.
2. Plan for School-aged Children to Thrive
  • Assess the costs of education and additional care that may be necessary within the school environment.
  • Consider after-school programs and activities that can aid in your child's development.
3. Consider the Financial Needs of Your Other Children
  • Ensure your financial plan accounts for the future needs of your other children.
  • Discuss family responsibilities and expectations openly to foster a supportive environment.
4. Prepare for Adulthood
  • Start planning early for your child’s transition to adulthood.
  • Explore post-secondary education, employment opportunities, and potential living arrangements.
  • Consult with a special needs estate planning professional to avoid costly mistakes and consider programs like tax-advantaged savings accounts for disability expenses.
5. Consider a Special Needs Trust (SNT)
  • Establishing an SNT can protect your child's eligibility for government benefits while allowing them to benefit from your assets.
  • Inform family members about the SNT to ensure all contributions align with the trust, preventing disqualification from essential assistance programs.
Understanding and planning for the costs associated with raising a child with disabilities can secure a brighter financial future for your family. At GrowStrong Wealth, we specialize in creating customized financial strategies that address these unique needs.

Schedule a consultation today to start building a comprehensive financial plan that ensures your child's needs are met both now and in the future.

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