Financial planning for families caring for a member with disabilities

By Citizens Securities Inc., Staff

Physical, emotional, and mental disabilities are pervasive in the U.S., affecting one in four Americans¹, including more than three million children². These diagnoses are often difficult to define and vary significantly in condition and degree of severity.

Stereotyping, stigma, and discrimination are challenges an individual with a disability faces every day. Life can also be complicated for families who have members with disabilities as they overcome societal and financial challenges in order to experience a brighter tomorrow. Many considerations—from affordability to accessibility—go into providing the proper support for individuals with disabilities. Being prepared with a sound financial plan can help alleviate stress and avoid long-term hardship. While there is no single blueprint for life’s journey, there are many resources available to empower and inspire. Working with an experienced financial advisor can help guide you toward a plan that helps you achieve your goals.

In order to prepare a strong financial plan, here are some of key insights and implications to consider.

Understanding the medical diagnosis, treatment, and potential duration of your family member’s condition is a critical first step. The diagnosis will influence the course of your financial planning and help determine your short- and long-term needs—both logistical (qualitative) and financial (quantitative).It’s important at this initial stage to communicate openly with spouses, partners, siblings, parents, and others involved so they understand the path ahead. Communication and separating emotional from practical decision-making can alleviate some stress of planning and caring for others.

When embarking on a financial planning journey, it’s important to find an advisor you trust and feel comfortable discussing highly personal and confidential subjects. During the discovery meeting, a financial advisor can build a clear picture of your current situation and identify concerns, existing resources, and overarching goals. This insight will guide the planning process and outline those actions you might take to help achieve your goals.

With a good understanding of your family’s current circumstances, a strategy that takes into consideration the level of care your loved one requires will be formed. A financial advisor can also help identify unique solutions to challenges you may be experiencing, which can better position you for the future.

A key part of any good financial plan is developing a strategy that builds upon and helps preserve your assets. A financial advisor can work with you to identify your family’s existing sources of income, including:

• Salary and other earnings
• Savings, investment, and retirement accounts
• Social Security benefits
• Insurance policies, such as medical, disability, and life
• Health savings accounts
• Real estate holdings
• Business ownership

There are alternative resources that might supplement your finances. Benefits offered through your employer — paycheck advances, employee assistance programs, intermittent or full-time leave under the Family Medical Leave Act, and accommodations under the American Disabilities Act, for example. You may qualify for public assistance at the federal, state, or municipal levels. Community, charitable or nonprofit grants, educational scholarships, and low or no-cost services or equipment may be available to you. Additional support can have a significant impact on your financial plan and peace of mind.

Preparing for how you want to pass assets to the next generation is a critical financial planning step. Comprehensive estate planning is especially important to safeguard family members with special needs who may be unable to care for themselves. Ultimately, it’s important to make known how you want your affairs to be handled.

A financial advisor can suggest estate planning strategies to help carry out your wishes, including wills, trusts, and powers of attorney. For families who have members with disabilities, there are particular instruments, such as medical directives, special needs trusts, custody provisions, guardianship, and gifting strategies that could be beneficial. Beyond a financial advisor, other professionals—such as an attorney, accountant, insurance agent or mortgage banker—may be consulted to provide advice in their field of expertise, like taxes or loans.

Once you’ve implemented a financial plan, it’s important to review it regularly with your advisor and make updates so it remains aligned with your goals, as your needs or situation change. Maintaining good records and saving financial, medical, and government documents can support conversations with your advisor and alleviate issues down the road.

Citizens Securities and Citizens Private Wealth have experienced, knowledgeable advisors who can develop sound financial plans for families who have members with disabilities so they can feel more confident about their finances. Follow the link below to find and advisor and build a financial plan suited to your family’s unique needs.