Personal Finance

How to financially plan for the future care of a disabled loved one

How to Make a Financial Plan for People with Disabilities

Daniel Trush was only 12 when a brain aneurysm ruptured and changed the course of his entire life.

“I fell into a coma, and I was in a coma for 30 days – and I was in hospital and in rehab for a total of 341 days,” said Daniel, who is now 38 and lives in New York. But, he joked with a smile, “who’s counting?”

It was during his rehabilitation that Daniel and his family found a connection with others through music. He is now co-founder and president of Daniel’s Music Foundation, a non-profit organization that provides free music programs for people with disabilities.

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Daniel’s parents, Ken and Nancy, now in their 60s, helped him achieve his goals in part by planning his financial security with an entrepreneurial spirit.

“I’m used to business plans, so I converted a business plan into a personal plan,” Ken Trush said. “This is what we have. This is what we want to do. Where is the surplus? How much should we save?”

About 61 million adults in the United States, or 1 in 4, live with a disability, according to the Centers for Disease Control and Prevention. A new study from Fidelity has found that more than half of caregivers of disabled loved ones have little time to prepare before taking on the responsibility.

Daniel Trush, president of the Daniel’s Music Foundation in New York.

Daniel’s Musical Foundation

Still, about a third of respondents said it was easier than expected to create a plan for current and future spending and understand available government benefits.

Access all available benefits

One of the most critical steps in supporting a disabled child or beneficiary is applying for Supplemental Security Income or Social Security Disability Insurance, said James Lange, president of Lange. Financial Group in Pittsburgh. You can apply online at the Social Security Administration website.

Additionally, “maximize your benefits and start looking at government benefits available to you at your city, county, state and federal level,” said Jessica Tuman, vice president of the center for excellence Voya Cares. at Voya Financial in Atlanta.

Benefits can include healthcare concierge services that aim to help families care for loved ones with complex, chronic or ongoing care needs, she said. Your company’s programs can also provide legal services to help you with medical clearance forms for your child, your will, powers of attorney, and other estate planning documents.

Set up targeted savings

Boonchai Wedmakawand | time | Getty Images

According to experts, setting up targeted savings is also essential to secure the financial future of a person with a disability.

An ABLE account allows families to save up to $16,000 per year without affecting government benefits for someone who became disabled before age 26.

Plus, “if you were saving in a regular 529 plan and your child became disabled before age 26, you can transfer those funds to an ABLE account,” said financial adviser Charlie Massimo, senior vice president of Wealth Enhancement Group. in Deer Park, New York. “There are, however, certain restrictions and limitations that you must follow.”

One of the best ways to get help is to find nonprofit organizations for your particular type of disability.

jessica tuman

Vice President of the Voya Cares Center of Excellence at Voya Financial

If a child or disabled beneficiary inherits a traditional or Roth Individual Retirement Account or a 401(k), they can extend distributions throughout their lifetime, instead of having to withdraw cash within 10 years like most beneficiaries.

Optimizing Roth IRA conversions can also be “beneficial for you, but essential for your child,” Lange said, because it would allow parents to allow a disabled beneficiary to obtain tax-free distributions for life.

Tuman recommends that families seeking financial or legal advice regarding the creation of a special needs trust or other aspects of estate planning visit the Academy of Special Needs Planners and the Special Needs Alliance. to find experts.

Find a supportive community

Dougal waters | Digital vision | Getty Images

Connecting with other families with loved ones with disabilities is another way to learn about financial and other resources that may be available in your area.

“One of the best ways to get help is to find nonprofits for your particular type of disability,” Tuman said. Look to groups such as the National Down Syndrome Association, the Autism Society and Easterseals, which may offer specialized programs offering respite care and/or parenting support programs, she said.

Getting together for music and fun can also lead to important financial conversations — and relationships. “We find that a lot of caregivers of parents come together because there’s a commonality,” Ken Trush said. “They feel comfortable.

“Sometimes people on the outside don’t understand what they’re going through.”

September is Brain Aneurysm Awareness Month. Daniel Trush and Sharon Epperson are brain aneurysm survivors. You can read more about the risk factors and the treatment of this disease on the Brain Aneurysms Foundation website.

Fix: Only surviving spouses can convert an inherited IRA to a Roth IRA. An earlier version of this story contained incorrect information.

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