Dear Carrie: I'm 50 years old and in good health but need to create a secure safety net for my 17-year-old son with autism. He's living at home now, and I'm worried in case something happens to me. I'm not wealthy; what are my options? --A Reader
Dear Reader: I'm glad you're asking this question -- both for yourself and for the increasing number of parents who are faced with caring for a special needs child or adult.
According to the Centers for Disease Control, approximately 20 percent of U.S. adults have a disability. Recent CDC data also states that 1 in 88 children has been identified with an autism spectrum disorder.
While handling the day-to-day care of a special needs child can be challenging, planning for the future is equally important -- and potentially complicated. That's because, while there are a number of government assistance programs available, how you set up additional financial support can directly affect whether or not your child will qualify for public benefits.
So it's not just a matter of providing a financial safety net; the methods you use are also crucial to the ongoing well-being of your child.
Here are some things you can consider doing now to help give your son the security he needs -- and give yourself some peace of mind.
ESTABLISH YOURSELF AS LEGAL GUARDIAN
First, establish yourself as your son's guardian when he turns 18. Otherwise, your son will be considered an independent adult under the law, and you may not have access to his medical records or make decisions on his behalf.
APPLY FOR GOVERNMENT BENEFITS
There are two government programs that your son could qualify for: Medicaid, which covers most medical services; and Supplemental Security Income, which provides a monthly stipend for basic living needs. In order to maximize benefits, apply for these benefits when your son first becomes eligible at age 18.
CONSIDER A SPECIAL-NEEDS TRUST
SSI and Medicaid are a good start. But if you want to make sure your son has more than the bare bones, there's a catch. In most states, an individual with special needs can't have more than $2,000 in assets to be eligible for assistance. This means that if your son owns or inherits more than the eligibility requirements allow, he'll lose government support.
Fortunately, you can get around this problem by setting up a special needs trust (also called a supplemental needs trust). With this type of trust, designed especially for individuals with a disability, the assets belong to the trust, not to the individual, so there's no issue with continuing to collect government assistance.