As a parent, ensuring the long-term well-being of your child, especially if they have special needs, is paramount. If your minor child is receiving a settlement due to a lawsuit and will require care throughout their life, it’s crucial to manage these funds wisely. One effective solution is establishing a first-party special needs trust, a tool that a knowledgeable Andover special needs lawyer can help you set up.
Understanding a First-Party Special Needs Trust
A first-party special needs trust is specifically designed to hold assets for the benefit of a person with special needs. Unlike other trusts, it is funded with the beneficiary’s own assets, such as a legal settlement. The key advantage of this trust is that it allows the beneficiary to retain eligibility for government assistance programs like Medicaid and Supplemental Security Income (SSI), which have asset limits.
Why Consider a First-Party Special Needs Trust for Settlement Funds?
Settlement funds, if not managed correctly, can disqualify your child from vital government benefits. A first-party special needs trust ensures that these funds are used to enhance your child’s quality of life – covering expenses like specialized medical care, therapies, personal care attendants, and other needs – without endangering their eligibility for public benefits.
Setting Up a First-Party Special Needs Trust
Creating a first-party special needs trust involves several critical steps and legal considerations. Collaborating with an Andover special needs lawyer is essential to navigate this process. Your attorney will ensure that the trust is properly structured and meets all legal requirements, providing a secure financial foundation for your child’s future.
Managing the Trust: Roles and Responsibilities
The trustee, whom you appoint to manage the trust, plays a crucial role. They are responsible for making prudent financial decisions, ensuring that distributions are made in the best interest of your child, and maintaining compliance with legal and regulatory requirements. Choosing a trustworthy and capable trustee is vital for the effective management of the trust.
Long-Term Planning and Peace of Mind
A first-party special needs trust is more than just a financial tool; it’s a cornerstone of your child’s long-term care plan. It provides peace of mind, knowing that your child’s financial needs will be met without compromising their access to government assistance. This trust is an investment in your child’s future, ensuring they have the resources they need to thrive.
Getting Help
Navigating the management of a settlement for a child who requires lifelong care is a significant responsibility. A first-party special needs trust offers a practical and effective solution, ensuring that your child’s needs are met in a way that secures their future. It’s a decision that can offer profound peace of mind for you and your family.
If your child is receiving a settlement and you need guidance on securing their future, our Andover special needs lawyers are here to help. Contact us at 978-409-1928 to discuss how a first-party special needs trust can provide the financial stability and care your child deserves.