Special Needs Trust

There are two categories of special needs trusts:  one that is funded with assets that belong to the Beneficiary, and one that is funded with assets from other people, usually the parents. They are called self-settled trusts and third-party trusts, respectively.  

Special needs trusts are designed to allow families to leave money for the Beneficiary without jeopardizing eligibility for programs like Medicaid and SSI. The money can be used to enhance the life of the Beneficiary, paying for things such as travel, specialized therapies, education, transportation, haircuts, furniture, entertainment, etc.  But the rules are strict on how that money can be used, and it can only be used to help the named Beneficiary.

Caregiver Trust

Many of our family members will always needs some level of supervision and support.  The caregiver is who replaces the parent in providing that support. It can be a stressful task.  The purpose of the Caregiver Trust is to attract and retain successor caregivers.  It provides money that can be used to help the caregiver and the caregiver’s family, whether that be respite care, or vacations, and whatever else can give the caregiver ways to recharge and avoid burnout.

Spendthrift Trust

This trust is available for Beneficiaries who may not ever qualify for programs like Medicaid but will always need some level of financial supervision.  The assets of a spendthrift trust are used for the health, education, maintenance and support of the Beneficiary, but the Beneficiary is not the Trustee and does not have control of the checkbook.  Unlike the special needs trust, there are few restrictions on what the money can be used for - the Trustee decides if the expenditure is appropriate.  An additional benefit is that this trust cannot be seized by creditors of the Beneficiary.