Planning for the future has become one of the most urgent needs facing families with children and adults with autism, Down syndrome, and other special needs. As many as 6 million adults in the U.S. have autism, and every year, as many as 100,000 individuals age out of children’s services. For their families, planning for the future is critical, says a recent article from yahoo! finance, “Financial planning for children with autism: A guide to ABLE accounts, special needs trusts, and more.”
When children are young, most families are focused on health, developmental delays, and education. They often don’t have the energy to also prepare for the financial realities of supporting an adult with autism. However, the earlier planning starts, the better.
Special Needs Trusts (SNTs) are the building block for the future of a child with special needs. When a person with special needs turns 22, they have outgrown eligibility for school services and support from most state programs. Medicaid comes in as the key funding source for medical care and employment-related services.
The biggest mistakes parents make are first, waiting too long to plan, and second, not understanding the consequences of gifting money directly to the individual with special needs. If a well-meaning relative leaves a bequest or gives money outright to the person, they could become disqualified from government benefits. This is where a trust comes in.
The trust is a means of savings without putting means-tested government benefits at risk. An experienced estate planning attorney can create a Special Needs Trust to help the family plan and protect benefits.
The ABLE account complements the SNT. This is a tax-advantaged savings account for individuals with special needs, like a 529 college savings plan. Contributions are made with after-tax dollars, and if earnings are used for qualified expenses, withdrawals are tax-free. ABLE funds may be used for housing, food, transportation and education costs. Contributions are limited, generally to $18,000. However, this is still a good way for people with special needs to save and spend without putting their government support at risk.
Another issue parents of disabled individuals worry about is long-term care. With most caregivers being older than 60, planning for long-term care for people with autism is a difficult challenge. A care plan should include naming a legal guardian for the person with special needs in case their parents die. Naming a successor trustee for the SNT is also critical for the plan to work as intended.
The key takeaway is to consult with an experienced estate planning attorney, preferably a Certified Elder Law Attorney, who understands the unique challenges faced by parents of children with special needs, and to start planning early, allowing the plan to be thoughtfully created and executed.
Contact our office today to get started.
Reference: yahoo! finance (Aug. 31, 2025) “Financial planning for children with autism: A guide to ABLE accounts, special needs trusts, and more”
