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Special needs financial planning

Creating a special needs financial plan for a loved one requires extra preparation.

Having a solid financial strategy can provide needed peace of mind when it comes to caring for an adult or child with special needs. While it will cost roughly $233,000 to raise a child from birth to age 18, the lifetime cost of raising an individual with an intellectual disability can average $1.4 million to $2.4 million, depending on the complexity of their needs and how long they require guardianship. Fortunately, creating a special needs financial plan is not something you have to do on your own.

One of the best moves you can make is to assemble a team of professionals who can help you make the right legal and financial decisions for your situation. Start by determining your needs and identifying the resources that can fulfill those needs.

Children with special needs

If your child is diagnosed with a neurological, developmental or physical disability, contact your local school district's special education department. The teachers and counselors there will play a major role as your child develops appropriate life skills. Social service agencies may be able to provide additional support outside of school, such as appropriate recreational opportunities.

It's also a good idea to establish a legal guardian for your child as early as possible. While you will name this individual in your will, it's critical that you discuss this responsibility with them first, as they could be responsible for overseeing all aspects of your child's care.

Financial planning for special needs adults

For special needs individuals who qualify, government agency programs such as Supplemental Security Income (SSI), Social Security Disability Income (SSDI) and Medicaid can provide basic food, shelter and healthcare. When it comes to supplemental needs like education, transportation, entertainment and travel, a special needs trust can be a useful tool. You'll need an experienced attorney to set one up, but once implemented and funded, it can be used immediately.

To ensure a family member with special needs continues to receive the care they need even after you can no longer care for them, consider including life and disability insurance in your plan. As a financial services professional, a State Farm® agent can help you identify the right products to help you reach your financial objectives.

The information in this article was obtained from various sources not associated with State Farm® (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates). While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. State Farm is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. These suggestions are not a complete list of every loss control measure. State Farm makes no guarantees of results from use of this information.

Neither State Farm® nor its agents provide tax or legal advice.

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