While it can be difficult to have to think about caring for your family after you pass, doing so when you are responsible for a loved one with disabilities is even more difficult. In order to alleviate some of your concerns, we have put together this two-part series about Special Needs Trusts.
In the first post of this two-part series, we defined the basics of what a Special Needs Trust is and it’s benefits. In this second part, we will discuss how you can set one of these trusts up using your life insurance policy.
Funding your Special Needs Trust
As we mentioned in the last post, this type of trust is designed to help support your loved one living with disabilities without affecting their government benefits like Social Security, Medicaid, or Medicare. To do this you will need to put money in the trust, but where does it come from?
There are a number of ways you can use your savings, investments, or even your will to fund your trust. One of the best and surest ways to fund your trust is with your life insurance plan. Some of the many benefits of using your policy include:
You can get an excellent value for your money because your monthly premium can help secure a significant death benefit.
You may avoid excess income and estate taxes if your family structures your trust correctly. You have much more control over how your estate is split among your surviving family members.
By using your life insurance to set up a Special Needs Trust, you are providing your loved ones with the resources to lead a full life even after you pass.
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This article is for informative purposes only and not intended to provide legal or tax advice. You should consult with an attorney or tax accountant for professional education.
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