subject: 5 Things To Remember About Life Insurance And Special Needs Children [print this page] Don't Save, Insure
Having a child with special needs is the quintessential reason that life insurance exists! There will be large sums of money that are needed after your death, when they won't be available from anywhere else. Most people see life insurance as an expense that detracts from the savings that will be available after you die - however it is actually an effective form of saving.
Re-think Your Life Insurance Payout Having a kid with special needs is so often a blessing, rather than the curse that others imagine it to be! Kids that are a little different can teach us so much about love and human nature ... but you certainly have to plan your life a little more carefully than the standard family. Life insurance is one of the things that you'll need to think about in more detail if you have a kid with special needs, whether they are physical or mental. Today we check out some of those changes.
The most notable and simple change will be an increase in your life insurance payout. Ordinarily you would plan to support your kids until they were 18 or 25; if you have a child that will need lifelong physical care that must factor into your choice of benefit. Ensure that there is enough of a benefit that your life insurance funds could be put in a term deposit, and the interest used to pay for care and life needs.
Get Legal Advice
You should get specialist advice on setting up your will, conservatorship and guardianship of your child from somebody with experience in special needs kids. Your solicitor will help you understand issues like those below.
Be Aware of the Government's Role
Naming your child as the beneficiary of a large sum of money could not only disqualify them from receiving government benefits, but also services which would be very difficult for them to otherwise access. Setting up a trust for your child may be a way around this; your lawyer will be able to let you know more.
Be Aware of Your Child's Limitations
If your child has a purely physical disability, you may be comfortable giving them the power to make decisions over their life insurance benefit once they are legally able to. However, if you simply bequeath a large sum of money or property to your child who doesn't have the mental or emotional capacity to deal with it, this makes it very difficult for other people to step in and help them.
Life insurance, and proper planning for it, can help ensure that your child's different abilities continue to be a blessing themselves and those around them by relieving the burden of everyday care.
