When you first learned that your child had special needs, you may have wondered how to do your best to provide care throughout his or her life. As your child grew and you learned more about his or her disability, you may have found yourself quickly falling into a routine that allowed you to meet his or her specific needs. Now that your child has gotten older -- and you as well -- you may wonder how his or her needs will be met in the event of your passing.
Though it may pain you to think of a time when you will not have the ability to care for your child, it may bring you some comfort to know that you have taken steps to ensure that he or she does not face unnecessary difficulties. One way to help with such an endeavor involves creating a trust -- specifically a special needs trust.
What is a trust?
First of all, you may need to understand that trusts in general involve transferring assets into an account managed by an outside party known as a trustee. These accounts benefit other individuals, especially when it comes to financial protections. If you would like to create a trust for your special needs child, he or she would act as the beneficiary of the trust.
How is a special needs trust useful?
When it comes to special needs trusts, your child could benefit in a variety of ways. Depending on the terms of the trust, your child could receive financial benefits in the form of a monetary inheritance or other means without potentially risking his or her ability to obtain government benefits. Because government assistance often bases its approval on income, directly gaining an inheritance could disqualify your child from obtaining those much-needed benefits.
If you create a special needs trust, you can put the inheritance in the trust, and the trustee will manage those funds. As a result, your child will not have a direct connection to the funds, and therefore, the government will overlook those funds when reviewing your child's benefit status. Additionally, you will not have to fear that your child will misuse funds as you can ensure that the trustee has control over when and how the funds go to use.
How is a special needs trust created?
Because special needs trusts can hold a great deal of importance, you will certainly want to follow the proper legal channels for creating your trust. Obtaining information from local Hawaii legal resources could help you better understand your options and what steps you need to take in order to properly create your trust.