Two Financial Tools to Help Support a Child with Special Needs

Parents or guardians of children with special needs face unique challenges. Children of all ages with special needs require support (including but not limited to housing, transportation, food, healthcare, employment and education) that often comes at an extra cost. The Rockland Trust Special Needs Services team has direct experience helping families of individuals with disabilities in their financial planning. 

Here are two financial tools that can help ensure a child you love with special needs is provided for now and in the future.  

ABLE Accounts Can Help Fund Education and Other Expenses  

In simple terms, ABLE accounts are a type of tax-advantaged savings account that can fund disability expenses. To qualify for an ABLE account, the child’s disability must have an onset prior to age 26. 

You may already be familiar with another type of savings account, 529 plans that are specifically for education. There are some cases when parents or guardians have 529 plans for their children with special needs, but decide that the funds would be better saved in an ABLE account. If so, they’re in luck! Funds from 529s can be rolled over into ABLE accounts.

The funds saved in ABLE accounts, under certain limits, do not affect eligibility for assets-based benefits. 

Consulting a financial advisor can help you determine if this type of account works for your family’s needs. 

Guide for Parents: When Your Child Has Special Needs 

Special Needs Trusts Offer Peace of Mind for the Long Term 

Families of children with special needs may feel confident that they can support their child in the present, but worry about what will happen when they pass away. If this sounds familiar, you may consider setting up a special needs trust. 

These trusts primarily allow families to make sure their children with special needs are provided for in the long term, meaning that they are able to maintain their current lifestyle after their caregivers pass away. While these trusts are most often used as an estate planning tool, they can also help pay for additional care and services throughout the child’s life.

Importantly, savings in special needs trusts do not jeopardize the child’s eligibility for government programs or benefits. This is due in part to the guardrails that ensure that trustees of these accounts spend the funds only on the beneficiary and on services that meet the child’s unique needs. 

Due to the complex nature of special needs trusts, they require expertise in administration, execution and ongoing management. The Rockland Trust Special Needs Services team has a thorough understanding of the income, gift and estate tax consequences that must be considered when funding and administering a special needs trust and can help you properly plan for your loved one’s future.

Listen to Episode 13 of “No Shame in this Money Game”— Special Needs Trusts

Need help deciding what is best for your family?

There are quite a few complex factors to consider when determining the right savings and support plan for your child with special needs, but Rockland Trust is here to help. Schedule a conversation with one of Rockland Trust’s financial consultants today. For more advice about finances and families, check out our Learning Center. 

Providing for Your Child with Special Needs After You're Gone

Note: Rockland Trust does not currently offer ABLE Accounts; families interested in this financial tool can visit https://www.ablenow.com/ for more information.