Financial Planning Challenges for Children With Special Needs

By Thomas Britt

Parents of children with special needs typically face unique challenges at various points along their journey: increased medical expenses, highly specialized care, and the need for extra support (just to name a few). On top of this stress is the added burden of worry about what will become of your child when you pass away. One way to lighten the load is to ensure the financial aspects of these needs are covered. So, how do you plan for these challenges and secure a sound financial future for your child?

Consider the practical steps below that you can take now to not only give yourself peace of mind that your child will be secure if something should happen to you, but also help to provide your child with safeguards while you’re still here.

Look into Government Assistance

Do you qualify for government assistance? While some qualifications vary by state, here are two programs we suggest you investigate.

Supplemental Security Income

Supplemental Security Income (SSI) is a federal income supplement program that provides cash to meet basic needs for food, clothing, and shelter. (1) If your child meets the Social Security Administration’s definition of a disability, then they may qualify for assistance. While your child is under age 18, Social Security considers all household income when determining eligibility. Once your child turns 18, benefits are calculated on his or her income alone. (2)


Medicaid is federally funded, but it’s administered and operated by the State (which means eligibility may vary from state to state). In most cases, if your child qualifies for SSI, they’ll qualify for Medicaid too. Medicaid funds can be used for healthcare expenses, home health services, medical equipment, and more.

Save for the Future

529 ABLE

Even with government assistance, you may still have ever-growing out-of-pocket costs as you care for your child. A 529 ABLE account helps fill in this gap.

529 ABLE plans, which are similar to 529 college savings plans, can be used for qualified disability-related expenses in addition to education-related expenses. These expenses may include housing, transportation, employment training, healthcare, and anything else needed to maintain your child’s quality of life.

As of 2021, you can make an after-tax contribution of up to $15,000 per year into an ABLE account. (3) The money is withdrawn tax-free for qualifying expenses. As long as the account balance is below $100,000, it doesn’t count toward calculating SSI eligibility.

Special-Needs Trust

For most high-net-worth families, opening an ABLE account is the first step in securing their child’s future. The second step is establishing a special-needs trust. Assets placed in this type of trust don’t interfere with your child’s ability to receive government assistance (as long as all assets list the trust as the beneficiary, not the child).

If your child is named the beneficiary of assets totaling more than $2,000, they’ll no longer qualify for government assistance. Keep this in mind to share with well-intentioned family members or friends who would like to leave assets to your child. They’ll need to list the trust as the beneficiary in order for your child to remain eligible for benefits.

Hope for the Best (But Prepare for the Worst)

Letter of Intent

You know your child better than anyone. If anything were to happen to you, you’d want your friends and family to be aware of all those personal details. A Letter of Intent does just that. While this document isn’t legally binding, it can include incredibly helpful information, such as:

  • Your child’s daily, weekly, and monthly routine
  • Your child’s personal likes and dislikes
  • Your hopes and dreams for your child
  • Your child’s medical history
  • Contact information for doctors
  • Any other pertinent information

Adult Guardianship

Once your child is 18, they’re legally an adult in the eyes of the law. If you foresee your child needing guardianship beyond the age of 18 (because they’re unable to make their own medical and financial decisions), speak with a professional about how you can become their legal guardian. This process may include creating a power of attorney or healthcare proxy in the event of an emergency.

Your First Step

As the parent of a special-needs child, you’re no stranger to both profound challenges and extraordinary joys as you experience the ups and downs together. This unique role deserves support in every possible area, but especially in the area of finances. As the father of a child with Asperger’s, my personal knowledge and experience inform the work that I do. I am honored to support you on this journey. The Benchmark team and I can help you navigate these complex financial issues by providing resources tailored to your specific situation. Please call 860.434.6890 or email me at to arrange a consultation. Together we can assess if we’re the right fit for your family as you move closer to financial security in this unique area of need.

About Thomas

Thomas J. Britt is managing director of Benchmark Wealth Management, LLC, with 20 years of experience in the financial industry. He specializes in executive financial planning, retirement planning, investing, as well as the management of trusts and endowments. Thomas is a CERTIFIED FINANCIAL PLANNER™ (CFP®) professional and holds the Master Planner Advanced StudiesSM (MPAS®), Certified Investment Management Analyst (CIMA®), and Chartered Retirement Planning Counselor (CRPC®) designations. He earned a Bachelor of Science in Finance from the University of New Haven, an MBA in financial technology from Rensselaer Polytechnic Institute, and a Master of Science in Personal Financial Planning from the College for Financial Planning. He is also a proud veteran of the United States Navy Submarine Force. Learn more about Tom by connecting with him on LinkedIn.

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