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man in wheelchair having conversation special needs planning Ivan-balvan/iStock/Getty Images Plus

Myths and Realities About Special Needs Planning

Debunking common misconceptions regarding planning with families with special needs.

Myth: Public benefits are sufficient.
Reality: Not if you want the loved one to have a cell phone or tablet or trips to the bowling alley or movie theater, especially if they need an attended escort.   

Myth: Siblings (or other family members) will do what’s necessary.
Reality: This leaves too much to chance. Even if the siblings accept the responsibility, are they capable of execution? And what if they predecease the beneficiary? 

Myth: Designating the person with special needs as a beneficiary of a life insurance policy or 401(k) secures their financial welfare. 
Reality: Doing so may imperil the beneficiary’s eligibility for public services. Suppose you do not explicitly direct the proceeds to their special needs trust. In that case, the money may go to the account holder’s estate, which could then be distributed to the children, including, with dire results, the beneficiary. 

Myth: Advisors need to have a family member with special needs to credibly offer special needs planning.
Reality: Having personal experience is never required to establish professional expertise in a domain.

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