The safest way to create financial stability for a loved one with special needs is to establish a special needs trust.
The beneficiary has access to lifelong funding and remains eligible for benefits when managed properly. A crucial step in creating this trust is selecting a trustee.
Is the person familiar with benefit programs?
Knowledge of benefit programs, such as Medicaid and Supplemental Security Income, is important for a trustee. The rules governing special needs trusts and benefit programs are different with each program. A trustee must evaluate every choice made to ensure it does negatively affect eligibility.
Would you allow an outsider?
You may feel more comfortable having a family member as trustee, but you also need someone well-versed in benefit programs. You have the option to appoint two people as co-trustees. You may also hire a trust protector that has the discretion to hire and fire trustees as necessary.
How available is the person?
The position of trustee requires availability for the special needs person. Hiring a professional trustee, such as an attorney, investment firm, or private fiduciary, could alleviate concerns that the trustee may not have time for the position.
Have you considered a pooled trust?
Pooled trusts combine the resources of multiple beneficiaries. This option presents many benefits, including an increase in funds, reduced fees, and more stable investments. Pooling is a feasible option for modest trusts.
The person you appoint should prove financially responsible and organized. Hiring an organization that handles special needs trusts regularly is a reliable option.
