When a child has emotional, physical or mental challenges, a careful estate planning is even more important. Certain traps that many people fall into with typical estate planning could jeopardize your child’s ability to access crucial government benefits such as SSI or Medicaid. One common tripping point for many people is naming a beneficiary designation in their retirement plan. You might have good intentions when stipulating a beneficiary designation in your retirement savings plan.

Since you can name contingent secondary and primary beneficiaries, you may think you are doing your loved ones a favor if something were to happen to you. However, leaving funds behind in retirement plans or any other type of tangible asset to a child with special needs can have unintended and negative financial impacts for those who are getting government benefits.

Qualifying for Medicaid, for example, is one common issue affecting special needs children. Many rely on these Medicaid benefits to be able to receive vital health care. Jeopardizing these benefits could make it more challenging and the retirement assets left behind may not be enough to substitute for the Medicaid benefits he or she was receiving before. In order to avoid these kinds of challenges, consult with an experienced estate planning attorney as soon as possible to talk about the various tools that can be put into place now to protect your special needs child both while you are alive and after you pass away.

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