Who Needs a Special Needs Trust?

Special needs trusts help ensure the future financial security of a loved one who lives with a disability. Learn how a special needs trust works, who benefits from one, and how to establish one today.

What is a Special Needs Trust?

A special needs trust enhances the quality of life for those living with a disability by increasing their access to the resources available to them. Special needs trusts are beneficial because they provide financial security for disabled individuals while preserving their eligibility for critical needs-based governmental benefits including Medicaid and SSI.

Special needs trusts are beneficial for those who have permanent special needs or disabilities, those who currently qualify for governmental benefits, those who have special needs but may not qualify for governmental benefits later, and those who cannot manage finances on their own.

There are two main types of special needs trusts: first-party special needs trusts and third-party special needs trusts:

  • First-party special needs trusts: First-party special needs trusts are often used when the person with a disability inherits money or property outright. First-party special needs trusts are beneficial when a person without a prior disability owns property in their own name, later become disabled, and thereafter needs to qualify for public benefits that have an income limitation. Property included in this type of special needs trust can only be used for the sole benefit of the beneficiary.

  • Third-party special needs trusts: Third-party special needs trusts are commonly used by those planning in advance for a loved one who has special needs. Typically, the parents of an individual with a disability or special needs will establish a third-party special needs trust; this type of trust is usually funded upon the death of the beneficiary’s parents or whoever established the trust.

At Legacy Enhancement Trust, our team can work with you to discover the best possible financial plan for your particular needs. We provide free consultations, affordable money management fees, and hands-on help to ensure you’re well-informed and confident in our work.

Contact us today at (888) 988-5503 to learn how we can assist you.

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