Tuesday, April 21, 2020

Specialized Planning Needs an Ideal Solution

Families who have loved ones with disabilities require specialized planning and should consider a properly funded Special Needs Trust with life insurance as an effective way to address their unique and specific needs.

When dealing with a disabled child, the two most important goals are to provide for the child’s needs and simultaneously provide financial protection for the assets that are set up to meet those needs. Basically, a trust is a legal entity through which the legal ownership of property is separated from the right to benefit from the property. The legal title to property that is placed in trust belongs to the trustee but the trustee is legally obligated to use the trust property only for the benefit of the trust’s beneficiary.

Life insurance is an ideal vehicle to fund a special needs trust. This is because the death proceeds become immediately available at the deaths of the parents. So the policy selected should provide level premiums, increasing cash values and contain provisions that will sustain the policy in the face of the parents’ inability to pay premiums due to old age or disability. A whole life or universal life type policy can provide increasing cash values to maintain the policy during the parents’ old age and a waiver of premium provision can cover the parent’s disability.

Daily life brings unique challenges and joys for families with special needs. Caring for disabled loved ones may leave little time for anything else, and creating a long-term strategy can seem like a daunting task. By creating a properly funded Special Needs Trust with life insurance, you can help your clients create a source of funds to provide essential care in an unexpected event.

Get Solutions for Special Needs Planning here

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