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What to Do When Your Special Needs Child Turns 18 | Financial Support

Special Needs Trust

The financial planning steps you take when your special needs child turns 18 will establish the foundation for your child’s support and well being for the rest of his or her life.

If you make the wrong decision during this transition, it could affect your child well into the future – often when we’re no longer here to care for him or her.

Therefore, as parents of special needs children, it’s important for us to understand our options when planning for our children’s financial future.

Most special needs planning begins with a look into whether a child needs and qualifies for Supplemental Security Income (SSI) for support. SSI is a means-based program for people with disabilities and provides a limited monthly cash benefit of about $733 a month, the exact amount depending on the state and whether the beneficiary receives housing or income from other sources.

In and of itself, this payment may or may not mean much for a child’s financial future, but SSI eligibility also comes with a much more important benefit — access to Medicaid. For this reason alone many families, especially those with children who have major medical expenses, pursue SSI benefits despite the program’s severe income and asset limits. SSI can also be the ticket into vocational training and group housing services.

Once a child reaches age 18, she qualifies for SSI based on her own income and assets. In order to receive benefits, the child must meet the government’s disability standard, have less than $2,000 in assets and receive minimal income. Each dollar of unearned income (including any direct payments of cash to a beneficiary, along with additional reductions for in-kind payment for food and shelter) and every two dollars of earned income reduces a beneficiary’s base SSI award by one dollar.

If the SSI benefit reaches zero because of this reduction, SSI coverage ends. Despite these restrictions, an SSI beneficiary needs only a $1 award in order to retain her Medicaid benefits, so careful planning in this realm carries great rewards.

A child who became disabled before reaching 22 years of age can also collect Social Security Disability Insurance (SSDI) based on a parent’s work record if either of his parents has worked enough quarters to collect Social Security and is already receiving Social Security benefits or has died. Under SSDI, the “adult disabled child” of the Social Security beneficiary receives a monthly benefit check, as long as he doesn’t perform substantial work, defined as earning more than $1,090 a month. After receiving SSDI for two years, the adult disabled child also begins to receive Medicare, a substantial benefit.

Often, adults who became disabled as children receive SSI benefits until their parents retire, at which point they transition to SSDI, which is usually preferred both because it may offer a higher monthly benefit and because the beneficiary no longer needs to be concerned about SSI’s strict rules on other sources of income and savings. On the other hand, the switch to SSDI can be problematic if it means that the adult child loses eligibility for Medicaid or other programs.

If a child has more than $2,000 in assets when he reaches age 18, rendering him ineligible for SSI, a parent, grandparent or court has the power to create a special trust, known as a “(d)(4)(A) ” or “first-party supplemental needs” trust to hold his savings. Any assets held by the trust do not count against the $2,000 asset limit for SSI, allowing him to qualify.

One requirement of such trusts is that when the beneficiary dies, any funds remaining in the trust must be used to reimburse the state for medical care the trust beneficiary received during his life. Because of this payback provision, planners often encourage trustees to pay for a child’s supplemental needs from a (d)(4)(A) trust before using other assets, in order to limit the state’s collection later on.

Finally, many families create trusts known as “third-party” supplemental needs trusts in addition to (d)(4)(A) trusts.  As long as families fund these trusts with their own assets (never with their child’s funds) and give the trustee complete discretion to distribute the funds for a beneficiary’s care, the funds held in the trust will not count as the child’s assets. Furthermore, these trusts do not have to contain a payback provision, allowing families to place significant amounts of money into the trust without worrying that the government will receive a large portion later on. The trusts can then provide a child with special needs with services and care he may not receive from other sources throughout his life.

You don’t want to wait to plan for your child’s transition out of childhood. We can help you start planning for the future today. Contact or 678-325-3872.

Special Needs Trusts & Estate Plans – When’s The Right Time?


As a parent or guardian of a child or adult with special needs, one of our main concerns is what will happen to our loved ones when we pass? Who will take care of them? Will they have enough money? Will they be OK?

And while most of us try NOT think about dying, it’s an important step in ensuring that our loved ones will be protected and cared for upon our passing. Putting into place a special needs trust is something we can do to help ensure that our child or adult ward will be well cared for and have a high quality of life.

Too many times we’ve seen families devastated by the sudden loss of parents or guardians. Now is the time to plan and put into place a legal plan that will help protect your loved ones and their government benefits.

Eligibility for many government benefits are determined based on the resources your child or adult ward holds in their name. If they have too many resources, even by just one dollar, they may not qualify for, or may even lose, benefits such as Supplemental Security Income (SSI) and Medicaid.

Even if your child or ward does not currently receive government assistance, he or she may need it in the future. A special needs trust is a way to protect their current resources and future benefits. Through a special needs trust you can leave assets to your child or ward without negatively impacting his or her government benefits.

Government benefits only cover basics such as food, clothing and shelter. Through a special needs trust, a designated trustee for your loved one will be able to provide your child or adult ward with access to things such as:

  • a personal care attendant
  • out of pocket medical and dental expenses
  • vacations
  • home furnishings
  • vehicles
  • hobbies
  • and education.

Jeyaram & Associates has extensive personal and legal experience with setting up special needs trusts and estate plans. Please contact DJ Jeyaram at or 678.325.3872

Most Important Item On Your “To-Do” List That Never Gets Done: Create A Will

Wills, Trusts and Estate PlanningEveryone, yes, everyone, needs a will, trust or estate plan. Most of us know we need a will. Most of think about it. And then we put it on our “To-Do List” and forget about it until we hear about someone who recently lost a loved one. And then we think about it again, and put it back on our “To-Do List” – only to forget about it again.

However, completing a will, trust or estate plan is one of the easiest things you can do to protect your loved ones and your assets.

Jeyaram & Associates can help you protect what’s most important to you with a will, trust or estate plan. We’ll walk you through the process, step-by-step – without all the legal jargon. No one likes to think about dying, but having a legal plan in place can make your passing much easier on your loved ones.

Contact DJ Jeyaram: or 678.325.3872