Tag: grand rapids special needs planning

Michigan ABLE Accounts Arrive | Michigan Special Needs Planning

December 11, 2016 /

Going back almost two years, you may remember me mentioning in this post that Michigan enacted its version of the ABLE Act (Achieving a Better Life Experience Act).  Although Michigan passed its version of the ABLE Act in October of 2015, you could not form a Michigan ABLE account until just recently. This is because there was no established rule for how the accounts would be regulated and what financial institutions would manage them. Well, I have good news.  The wait is now over – Michigan officially has ABLE accounts.

Why does this matter?  Well, for many years, individuals with disabilities (and their caregivers) have faced a difficult decision if they received money in their own name via inheritance, personal injury settlement, or gift – spend it all, pursue a court-created trust or non-profit “pooled” trust, or risk losing vital government assistance.  As with many things, more choices mean a better chance of a choice that fits your situation.

The ABLE account offers a new, additional option for individuals with special needs.  In short, an ABLE account allows certain people with disabilities to have special savings accounts for disability-related expenses without losing eligibility under SSI, Medicaid, and certain other public benefits.  By putting funds in an ABLE account, those funds are not considered a “resource” for the person with the disability (it does not count against him or her).  There are limits on the contributions to the account: no more than $14,000 per year and no more than $100,000 total.  Anything above the maximum amount is considered a “resource”.  The account funds can be used generally for expenses related to the individual’s disability including education, housing, transportation, employment training and support, assistive technology and personal support services, legal fees expenses for oversight and monitoring and funeral and burial expenses.  A Michigan ABLE account has a $45 per year fee, plus the investment expense associated with the individual’s chosen investment option(s).  You can find more information, and open an account, at www.miable.org.

It is important to know that an ABLE account is not the solution in every situation.  Other planning strategies are still valid and may be a better option.  The ABLE account is an additional option.  If you have questions about or need help ensuring the maximum benefit and quality of life for a disabled family member or friend, please contact me.  As a Grand Rapids, MI special needs planning attorney, I am happy to help.

Michigan Special Needs Children – Caring Through Planning

August 1, 2010 /

This post is an excerpt from a recent issue of my weekly e-newsletter.  I received such a positive response that I thought I would share it with my blog readers as well.  If you would like to receive these fun, informative and helpful weekly e-newsletter, click here and put in your information.

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Today I want to talk about special children.

Every child is special, in their own unique way. That said, certain children are even more precious–and their needs are great. I’m referring to what many call “special needs children” (though, it’s perhaps better to call them children with special needs–after all, they really are “children” FIRST, and not to be defined first by their “needs”!).

Because this is something which adds certain complications to any family, I thought I’d take a moment this week to address 3 key wealth strategies for families with these beautiful, special children.

Feel free to forward this along to families who come to mind, and let them know that we will certainly assist them with their unique situation.

Let me know what you think!

Here is the standard thinking, in regards to setting up your affairs with children who have special needs:

Families realize that they have to support these children for the rest of their lives. So, they typically write wills and take out significant term life insurance policies. They are careful to name a trust as the beneficiary, because if their child has more than a minimal amount of assets upon reaching age 18, he/she will no longer be eligible for some government benefits.

However, while these families are indeed on the right track, parents with special needs children also should:

1. Set up a second trust. I am a strong supporter of stand-alone special needs trusts.  The purpose of this additional trust would be to make sure that the provisions in the parents’ trust don’t disqualify the child from receiving any government benefits that would otherwise be available for his/her care.  It’s better to “wall off” what the child receives.  The separate trust is also there so that friends and family members can contribute to the child’s care while the family is still alive–without causing the child to lose eligibility for any government benefit programs.

2. Increase savings. These families need a much larger emergency fund than most, and they also need to create a “reserve fund”. They should concentrate on savings–rather than paying off debt–especially if interest rates on loans are low.

3. Plan for three retirements. These families not only have to plan for their retirements, but also for their child’s long-term care. They should maximize their savings and take an aggressive approach with their portfolio to maximize returns over the long run.

While I’m not a financial planner, I thought that these tips were so important that if you find yourself in this situation, you should raise them with your professional adviser.

Warmly (and until next week!),
Mike

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Michael Lichterman is an attorney specializing in estate planning and helping provide peace of mind to families and businesses throughout Grand Rapids and West Michigan.  He specializes in Whole Family Wealth™ planning for professionals with minor children, doctors/physicians, nurses, lawyers, and the “sandwich generation” (caring for parents and children).  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.