Estate planning is about much more than determining who will inherit a painting, piece of jewelry or a house after an individual's death. It can also be about giving to charity, taking care of one's pets, and planning for a disabled individual's health care. This latter category is significant for many reasons, including the fact that health care costs can quickly eat into the value of an estate.
This is why many Floridians choose to utilize special needs trusts. These trusts allow an individual to put assets, oftentimes cash, away for a named beneficiary's future use to pay for medical care and other expenses. The biggest benefit of this type of trust is that it can allow an individual to retain government benefits that have strict income and asset requirements. For example, Medicaid and Supplemental Security Income may be unavailable to those with large estates, but assets placed into a special needs trust can reduce countable assets for these government programs' qualification purposes.
As with other trusts, these estate planning vehicles will need to be managed by trustees. Choosing an appropriate trustee can be of critical importance because he or she will dictate when assets can be released to the named beneficiary. Although trustees must act in the best interests of a named beneficiary, there is still some leeway with regard to how they act. Therefore, it is wise to carefully select this individual to avoid any complications further down the road.
Caring for a disabled individual can be enormously costly, and matters can be made worse when assets limit one's access to important government benefits. Fortunately, by carefully crafting estate planning documents like a special needs trust, Floridians can better ensure that their loved ones are as fully protected as possible, financially speaking.