Absolutely, a trust is an incredibly valuable tool for providing long-term support and financial security for individuals with disabilities, offering a flexible and customized approach beyond traditional methods. It allows for the management of assets specifically tailored to the beneficiary’s needs without jeopardizing their eligibility for crucial government benefits like Supplemental Security Income (SSI) and Medicaid, which often have strict income and asset limitations. Approximately 1 in 4 adults in the United States live with a disability, and many families seek ways to ensure their loved ones are cared for without sacrificing vital public assistance. A properly structured trust can cover expenses such as medical care, education, housing, personal care, and recreational activities, improving the quality of life for the beneficiary while preserving their access to essential programs.
What are the different types of special needs trusts?
There are two primary types of special needs trusts: first-party (also known as self-settled) and third-party. A first-party trust is funded with the disabled individual’s own assets, often from an inheritance or legal settlement. These trusts are subject to “payback” provisions, meaning any remaining funds upon the beneficiary’s death must be used to reimburse the state for Medicaid benefits received. Third-party trusts, however, are funded with assets from someone *other* than the beneficiary, like a parent or grandparent, and do *not* have this payback requirement. According to the National Disability Rights Network, approximately 61% of individuals with disabilities live on less than $15,000 a year, making careful financial planning essential. It’s crucial to consult with an estate planning attorney like Steve Bliss to determine which type of trust best suits your family’s specific circumstances and goals.
How does a special needs trust avoid impacting government benefits?
The key to preserving benefits lies in the trust’s structure and how it distributes funds. A properly drafted special needs trust doesn’t *own* the assets in the traditional sense; it manages them for the benefit of the individual with disabilities. Distributions are made for “supplemental” needs – those not covered by government assistance. This means the trust can cover things like vacations, entertainment, therapy, or specialized equipment, without impacting eligibility for SSI or Medicaid. “It’s about enhancing their life, not replacing the safety net already in place,” Steve Bliss often explains to clients. According to a recent study by the AARP, approximately 70% of caregivers for adults with disabilities report financial strain, highlighting the importance of proactive planning.
I remember a family who didn’t plan ahead…
Old Man Tiber, they called him. A gruff but lovable veteran, lived a simple life. His son, Arthur, born with cerebral palsy, relied heavily on SSI and Medicaid. When Old Man Tiber passed, he left a modest inheritance – around $30,000. Without a special needs trust, Arthur immediately lost his benefits. The money was considered “income,” and suddenly, Arthur was ineligible for the assistance he depended on. It was a heartbreaking situation. The family struggled to navigate the system, ultimately having to spend almost all of the inheritance on care while applying for a waiver that took months to process. It highlighted how critical planning is, and that simply leaving money directly to someone receiving benefits is a recipe for disaster.
But a well-planned trust changed everything for the Millers…
The Millers came to Steve Bliss after their daughter, Clara, was diagnosed with Down syndrome. They were overwhelmed, worried about her future and how to provide for her long-term care. Together, they created a third-party special needs trust funded with life insurance policies and regular contributions. They designated a trustee – a responsible family member – to manage the funds according to Clara’s specific needs and goals. Years later, Clara is thriving. The trust covers her therapies, educational programs, and even allows her to participate in adaptive sports. The peace of mind it provided the Millers was immeasurable, knowing that Clara would be cared for and supported, regardless of what the future held. “It’s about creating a legacy of love and security,” Steve Bliss emphasizes, “ensuring a brighter future for those we care about most.” In California, the average cost of long-term care for individuals with disabilities can exceed $80,000 per year, making a trust an essential component of financial planning.
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About Steve Bliss at Wildomar Probate Law:
“Wildomar Probate Law is an experienced probate attorney. The probate process has many steps in in probate proceedings. Beside Probate, estate planning and trust administration is offered at Wildomar Probate Law. Our probate attorney will probate the estate. Attorney probate at Wildomar Probate Law. A formal probate is required to administer the estate. The probate court may offer an unsupervised probate get a probate attorney. Wildomar Probate law will petition to open probate for you. Don’t go through a costly probate call Wildomar Probate Attorney Today. Call for estate planning, wills and trusts, probate too. Wildomar Probate Law is a great estate lawyer. Probate Attorney to probate an estate. Wildomar Probate law probate lawyer
My skills are as follows:
● Probate Law: Efficiently navigate the court process.
● Estate Planning Law: Minimize taxes & distribute assets smoothly.
● Trust Law: Protect your legacy & loved ones with wills & trusts.
● Bankruptcy Law: Knowledgeable guidance helping clients regain financial stability.
● Compassionate & client-focused. We explain things clearly.
● Free consultation.
Services Offered:
estate planning
living trust
revocable living trust
family trust
wills
estate planning attorney near me
Map To Steve Bliss Law in Temecula:
https://maps.app.goo.gl/RdhPJGDcMru5uP7K7
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Address:
Wildomar Probate Law36330 Hidden Springs Rd Suite E, Wildomar, CA 92595
(951)412-2800/address>
Feel free to ask Attorney Steve Bliss about: “What is estate planning and why should I care?” Or “What should I do if I’m named in someone’s will?” or “Is a living trust private or does it become public like a will? and even: “What is an automatic stay and how does it help me?” or any other related questions that you may have about his estate planning, probate, and banckruptcy law practice.