Estate Planning for Special Needs Individuals: Providing for Loved Ones With Disabilities

September 25, 2023
Erin Calpin, Esq.

If you have a child or other family member with special needs, estate planning can help ensure their financial security now and in the future.


Special needs individuals of all ages need reliable sources of income to provide for themselves, and an effective estate plan helps provide long-term support. Crafting an effective estate plan for a loved one with special needs requires careful preparation.


In this blog, our New Jersey estate planning attorneys provide comprehensive advice on how best to orchestrate what might seem like a daunting process, creating secure futures for those we love most.

Why Special Needs Individuals Require Different Estate Planning

Estate planning for special needs individuals is highly specialized and requires a comprehensive understanding of legal, financial, and healthcare issues.


Beyond basic considerations such as assessing your assets and assigning power of attorney, you must carefully consider conservatorship, trusts, insurance, and other factors unique to this situation.


You must set long-term objectives for the continued care of those with special needs, potentially long after the individual estate planner has passed away. This means that estate planners must focus on more than immediate needs, or even needs for a decade, but must have a forward-thinking approach to ensure their plan continues perpetually.


Special needs estate planning is far from "common" and requires deep expertise to create effective plans that will withstand the test of time.

The Benefits of Proper Planning

Completing comprehensive estate planning for individuals with special needs has many benefits and can help ensure peace of mind.


Structuring the financial plans carefully will allow you to protect assets and maximize the use of available funds, while minimizing the diminishment of benefits from Medicaid and other forms of government benefits.


Furthermore, proper estate planning will facilitate the transfer of assets to supportive systems, including guardian-based trustees or other third parties, after the primary beneficiary's death.


Planning also provides your family with clarity on what would happen in the event of a death.

The Unique Challenges You May Encounter

·        Estate planning for special needs individuals is a complex process, and there are many challenges you may face while making decisions about your loved one's future.


·        These may include determining whether a trust is the best action, selecting a guardian, or identifying which assets to use.


·        You may also need to consider tax implications and how to ensure enrollment in publicly funded programs, such as SSI and Medicaid.


·        There can be difficult conversations with family members about who will manage the estate plan and its ongoing care after death.

Establishing an Appropriate Trustor Guardianship

Establishing an appropriate trust or guardianship is paramount when creating an estate plan for a special needs individual.


Designing a trust can provide financial security and be tailored to accommodate specific medical, physical, and psychological needs. Furthermore, considering the future growth of the individual and potential legal restrictions will ensure that all undertakings are in the best interests of the special needs individual.


Additionally, selecting a responsible guardian should consider many factors, such as proximity, the capability to make decisions in good faith, and an understanding of essential financial management.

Best Practices for Managing Risk Factors

Managing the unique risk factors associated with this type of planning requires an understanding of the law, careful stewardship of financial resources, proactive monitoring of changes in regulations, and ongoing awareness of the overall health of the special needs individual.


Families must consider their circumstances before deciding on the best course of action, as each situation differs.


Preparing adequately also requires knowledge of Special Needs Trusts and other systems that offer protections and privileges to disabled dependents, and clear communication among stakeholders.

The Legal Considerations

Estate planning for special needs individuals is an intricate process. Those involved must understand various legal ramifications and documents to create a comprehensive plan meeting the individual’s needs.


This can include creating basic documents such as:


●    Last Wills and Testaments,

●    Powers of Attorney,

●    Living Wills,

●    Special Needs Trusts, and

●    Guardianship/Conservatorship.


Additional legal documents might be necessary depending on state laws and personal circumstances.


For instance, if an individual's disability impacts their ability to manage money or make decisions about their financial resources, a representative payee may be necessary to manage government benefits.


Additionally, you should consider gifting rules if the special needs individual receives government benefits, including SSI or Medicaid. In some cases, gifting could reduce the availability of their benefits.


An experienced estate planning attorney can help to ensure that all aspects of the estate plan are taken care of correctly while safeguarding the rights and interests of a special needs individual.


Planning and developing an effective intestate strategy is additionally essential, as many states have different rules relating to estates and special needs individuals. Doing so is imperative to guarantee fiscals ability no matter where your beneficiaries eventually reside.

Get Your New Jersey Estate Planning Done the Right Way With Help From BMC Estate Planning

Estate planning for special needs individuals is a vital yet potentially complex task.


Understanding the unique risk factors associated with managing a special needs individual and taking steps to plan appropriately is critical.


It's always beneficial to consult with an estate planning attorney with experience in special needs cases to ensure you make decisions that will ultimately benefit your loved ones the most.


The estate planning attorneys at BMC Estate Planning can help you manage your New Jersey estate planning with your special needs loved ones in mind.


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Borenstein, McConnell & Calpin, P.C. is a Wills & Estate Planning law firm serving Central and Northern New Jersey, as well as New York City. We strive not only to give you a great client experience, but to become your trusted adviser for life. To reach Alec, please send an email to

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