In Perspectives

Lillian-PhotoMy wife Deborah and I are the parents of a special needs child.  Lillian, our only child, was born with significant physical and mental limitations and we have devoted our lives to assuring she is provided the highest quality of care and given all the opportunity to maximize her potential.

Lillian turned eighteen last fall, which brought about a whole new dimension to our relationship.  We are no longer considered parents, but now guardians.  Up until now, we had been personally responsible for most of Lillian’s medical care and living needs, so it was welcome news to be reminded that she was now eligible for governmental benefits as a disabled adult – primarily Medicare and Supplemental Security Income (SSI).

It became apparent going through this transition that we needed to be more deliberate in the planning for Lillian’s care in the event she were to outlive us.  With the guidance of a highly-qualified attorney, we established a Special Needs Trust to be funded at our death from life insurance and other estate assets.

Our Special Needs Trust is primarily designed to preserve Lillian’s eligibility for the Medicaid and SSI governmental benefits.  Children and adults can qualify for Medicaid only if their monthly income and the value of their other assets fall below certain limits, which vary from state to state. (Michigan has set a $2,000 asset limit.)  Monthly SSI benefits can be used for basic needs such as housing and food, but are need-based, so if Lilian were to inherit assets from our estate directly, she would lose her eligibility for this important benefit program.   By naming a Special Needs Trust as the beneficiary in our estate plan, Lillian’s eligibility is preserved and Trust assets will be devoted to supplement the quality of Lillian’s lifetime care.

I would offer the following recommendations to those who may be contemplating the establishment of a Special Needs Trust for children or grandchildren with special needs:

  1. Work with a qualified attorney.  Special needs planning is complex and technical, which requires a professional with the requisite experience and a thorough understanding of the current income, gift and estate tax implications to special needs planning.
  2. Select a capable, independent Trustee.  This could be an attorney, bank or other professional trustee.   We chose Legacy Trust – not for obvious reasons, but the mere fact the Trustee has the resources to administer and manage the trust assets effectively, plus will be in proximity to Lillian to monitor her needs closely.
  3. Provide a letter of intent.  No one knows your child better than you.  While not a legal document, a letter of intent can provide important guidelines to the Trustee and guardian(s), such as medical needs, interests, social activities, etc.  It is important to review this letter periodically to assure the guidelines reflect current needs.
  4. Inform family members.  Explain to siblings and extended family members the rationale for establishing the Special Needs Trust.  Explanations and clear directions now may help avoid potential family conflicts down the road.

While Lillian’s transition to adulthood was a unique experience for us, we take tremendous comfort in knowing that the quality of her care will endure and that important government benefits will be preserved through our careful planning.

Legacy Trust and Your Right to Financial Privacy

At Legacy Trust we have established policies and practices that respect the financial privacy of all individuals who use our trust company. We believe it is critical to comply with the laws and regulations designed to secure your financial privacy. Your relationship with us as our client is very important to us, and we want you to understand our policies and practices about handling your information.

This Policy applies to you – This Policy applies to our relationships with individual clients who inquire about or obtain products or services from us for personal, family and household purposes.

Strict security measures – We take the security of information very seriously. We have established security standards and procedures to prevent access to client information. We maintain physical, electronic and procedural safeguards to guard client information.

Limited employee access – We have established procedures to limit employee access to information to only those employees with a business reason for accessing such information. We educate our employees about the importance of confidentiality and client privacy. We take appropriate disciplinary measures to enforce employee responsibilities regarding client information.

Why we collect information – We collect information about you to:

  • accurately identify you;
  • protect and administer your records, accounts and funds;
  • help us design or improve our products and services;
  • understand your financial needs;
  • save you time when you apply for new products and services; offer you quality products and services; and comply with certain laws and regulations;

We collect information – We collect and maintain your personal information so that we can provide investment management and other services to you. The types and categories of information that we collect and maintain about you include:

  • Information we receive from you to open an account or provide investment advice or other services to you (such as your home address, social security number, telephone, financial information and investment objectives).
  • Information that we generate to service your account or from our transactions with you (such as account statements and other financial information).
  • Information on your transactions with nonaffiliated third parties.

We have established procedures so that the financial information we collect is accurate, current and complete. We are committed to work with you to promptly correct any inaccurate information.

Our selective sharing of information – In order for us to provide investment management and other services to you, we do disclose your personal information in very limited instances, which include:

  • Disclosures to nonaffiliated companies as permitted by law, including those who help us service your account (such as providing account information to brokers and custodians).
  • Other limited disclosures as permitted by law, for example, required reports to government entities.

We do not share your information with third parties for marketing purposes. We do not sell your information.

Former clients – If you end your relationship with us, we will continue to adhere to the privacy policies and practices described in this notice.

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USA PATRIOT Act

Important Information About Procedures For Opening A New Account

To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify and record information that identifies each person who opens an account.

What this means for you: When you open an account, we will ask for your name, address, date of birth and other information that will allow us to identify you. We may also ask to see your driver’s license or other identifying documents.

We apologize for any inconvenience this may cause; however, federal law prohibits us from waiving these requirements.

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