As I am working in this area for almost 8-years now, I have so much admiration for parents who are working hard to get everything in place for their children’s future. Succession planning is never easy or nice to think about however I have met so many parents who would literally do anything to ensure a better quality of life for their child.
As is common in all areas of life I do come across issues that regularly pop up that have a major impact on the future. For this article, I thought I would discuss them in more detail.
Under estimating the size of Trust
Parents natural pay for all their children’s expense and sometimes forget when they are not around to pay for these bills, then it will be up to the money in the Trust. Rent, food, clothes, toiletries, eating out, entertainment, hobbies, taxis, will all add up each month.
Surprising enough I often speak to parents who assume that their child will need very little money in the future. Assuming their €188 per week will pay for most if not all of their child’s needs. Parents often get a nasty surprise when they find out about future charges such as the Long Stay Charge which applies to people with disabilities that live in accommodation provided by the HSE.
It is vital that your child inherits a substantial amount of money and certainly more than your other children. The rational for this is that they need more; your other children can work to determine they own quality of life; however, your child with special needs will be very reliant on what money you have passed onto them through the trust.
Keep building financial security
Clearing your loans, building your saving, increasing your pension size are all areas that you can control that will allow you to build a larger trust fund. The assets you pass on to your child’s trust will depend heavily on how you do financial yourself. Living long into retirement, needing nursing care, a change in government policy are a few areas that could have a significant impact on the money you intend to leave in a trust. So keep building up your assets and play it safely. Don’t take any unnecessary risk with your financial future.
Getting poor advice
A Financial Advisor would often approach families looking to sell a product and not fully understand the implication this may have on a family with a child with special needs. Never leave anyone, tamper with any of your products you put in place for your child’s future. In particular the Trust Life Policy or signing any document that gives an Advisor permission to tamper with it.
I regularly meet Parents who have signed up for financial products that will immediately stop their child future access to entitlement. They have received poor advice and signed documents with the word “trust” on it without realising that it is not the same as a legal trust that should be in place.
Don’t sign anything no matter how innocent it looks until you spoken to us.
Not communicating with your family on all aspect.
Well-meaning grandparents can often believe they are helping by leaving money to their grandchild with additional needs but this kind act could immediate stop all entitlements. Talking to your family and explaining what you have set up for your child’s future will help you educate your family on your child’s future needs. Assume your family will be Guardians & Trustees without truly asking them is another common mistake. This is a hard conversation but a must for all.
Once you completed the following documents.
- Hospital Passport
- Letter of Wishes
- Trust Plan
- Will & Trust
Then you also need to update them annual or immediately when your circumstances change. Keeping these documents relevant is vital and may only take 10-minutes of your time each year but could save your future Guardians/ Advocates months of work or guess work.
Waiting till your child becomes older before making decisions about their future only creates issues. Timing is everything in all walks of life and planning for the future, your greatest asset is if you have time on your hands. Ask any older parents and it is a common regret not to put the right plans in place when the child is young because as soon their child becomes an adult then it makes everything harder. Funding trust at this stage will cost hundreds each month but start early and it can be as little as €10 per week.