If you have a relative who has some type of disability, you probably worry about his or her ability to work. After all, just as certain physical and mental disabilities can make it difficult to land a job, they can also make it exceedingly hard to keep one. Still, your loved one has bills her or she needs to pay to survive.
Luckily, government programs often help those who cannot work. If your relative qualifies for these programs, he or she should receive monthly funds to pay for living expenses, such as housing, food and basic medical care. Government programs typically do not pay for much else, though.
Your special needs trust
You do not want to do anything to make your loved one ineligible for public benefits. If you give him or her cash or other assets, however, you may do just that. Setting up a special needs trust can help you strike the right balance.
A special needs trust gives your relative access to money to use on certain expenses without jeopardizing the public benefits he or she receives. If your loved one uses funds on impermissible expenses, though, he or she may lose public benefits either temporarily or forever.
According to AARP, as long as your relative does not use funds from the special needs trust on the same expenses public benefits cover, he or she is likely to be ok. Specifically, your loved one probably can use special needs trust disbursements on any of the following expenses:
- Home improvements
- Out-of-pocket medical care
Ultimately, by carefully explaining the rules of your special needs trust to your loved one, you ensure he or she has a better quality of life while still receiving critical public assistance.