When we are boarding an airplane, we have all heard the flight attendant remind us to put on our air masks first, before helping other passengers.  This common safety reminder is heard so often it does not always register with us.  This sentiment makes perfect sense, taking care of yourself ensures you are best able to care for those around you.  This rings true for Special Needs Parents looking to plan for their child’s financial future as well.  Often as parents and especially for Special Needs Parents, we prioritize our child’s needs over our own. 

In order to best take care of our children in their adulthood, beyond the time we are with them, we must be very strategic in our planning for our retirement, our long-term care needs and their needs once we have passed.  I say we because I too am a special needs parent. I know firsthand how easy it is to put financial and estate planning matters on the back burner.  There are so many other pots on the stove, many of which are bubbling over and require immediate attention.   However, when it comes to financial and estate planning, we do this at our child’s peril.


So where do we start?  As a financial advisor, let me walk you thru my process.  You need to start at the bottom and work your way up.  You need to build your financial house on a solid foundation.  So lets start with the basics.

  • Review your Home/Auto and Umbrella Policies. Meet with your agent, shop rates if it has been a few years.  Ensure you have adequate coverage. 
  • Review Your Life and Disability Insurance. Do you have the appropriate amount of coverage?  If you have term insurance, do you have the option to convert this to a permanent policy in the future? Can you add a long-term care rider or chronic care rider to your policy now or at conversion?  What are your conversion dates?  Record these dates, they are vitally important.  Do you have disability insurance, is this needed?
  • Are you saving for retirement? Do you have a qualified plan at work? What percentage of your income are you saving?  Can you afford to increase this savings?  Will this amount of savings be adequate for your retirement goals?
  • Do you have an emergency savings account? This account is the single most effective way to stay out of debt.    The best rule of thumb is to have 6 months of income saved.  This number can vary depending on your job security and access to credit.
  • Gather your Assets and Liabilities- compile your statements including your Social Security Statement which can be obtained at ssa.gov. Your mortgage statement, credit card statements, investments, bank accounts, any asset or liability statement is needed during a comprehensive review of your financial situation.
  • Gather Wills, Trusts, Medical Directives and other estate planning documents


Once you have all your information gathered it is time to sit down with a financial advisor and create a financial plan.  The advisor will review any current investments and help you to properly diversify and invest your assets.  The advisor should also review your liabilities and provide debt reduction strategies as appropriate.  A review of your mortgage and home equity loans is also important to ensure your interest rate is in line with current offerings.  Once a review and any necessary reallocations are recommended it is time to discuss goals and your future financial needs.  Often advisors will provide the financial plan for free if they are managing your assets.  I passionately believe everyone needs a financial plan, those with high net worth and complex situations as well as the young graduate just starting their career.

Not all financial plans are the same. In addition to planning for goals such as retirement (which I will not expand on here) or travelling, special needs families need to plan for their adult child’s life, long after they are gone.  For example, when working on the financial plan, you will need to look strongly at your long-term care needs. 

  • How will we pay for Long Term Care: Contrary to common belief, Medicare does not pay for long term chronic care needs such as in home or skilled nursing home care. This type of care is very expensive and can quickly wipe out a family’s nest egg.  Maximizing inheritance may be especially important when striving to fund a Special Needs Trust.  If a prolonged long term care event occurs for one or both parents, how will your retirement nest egg fair? 


  • Setting Up Special Needs Trust: During the financial planning process Special Needs Families will need to look at their estate planning documents. If Special Needs Trusts have not been established, they will need to do so in order to protect government supports.  Any asset left to the disabled child could hinder access to social programs such as Medicaid.  If trusts are not set up properly and beneficiary designations adjusted, funds remaining upon the disabled Child’s death could be subject to Medicaid payback rather than being passed down within the family.  Proper Estate Planning is about more than what funds will be left to your disabled child.  Difficult questions need to be answered about who will manage the trust?  Who is the successor Trustee? Who will be your child’s guardian?  (stay tuned for more blogs on this topic). 


  • Funding Special Needs Trusts: How much will be needed in a special needs trust? What type of supports will the child qualify for as an adult? Trusts are funded by inheritance and/or life insurance.  Permanent, usually second to die, life insurance policies may need to be purchased to fund the trust.  Hybrid Annuities may be used to ensure income for the adult child for years to come. Tax implications of rollover IRAs need to be explored and mitigated if necessary.

While constructing and maintaining your financial plan, your advisor will dive deep into these any many more questions.  While this may seem daunting our advisors walk you thru these steps to help reduce stress and time commitment.  By specializing in Special Needs Families, Clover Leaf Wealth is here to help tackle these complex planning needs with you.