A special needs trust can be a crucial tool for many families to pass on assets to their special-needs children without jeopardizing the recipient’s eligibility for public benefits. Some families may be interested in “pooled special needs trusts,” which offer similar benefits with certain advantages, but families may be unsure of the pros and cons.
Trusts must have trustees, or managers. Many trust holders hire their estate planning attorneys as trustees, while families of more limited means often turn to a relative or close family friend with the applicable know-how. A pooled trust may be a good option for those who cannot come up with a logical choice for a trustee, or for those without enough assets to justify an individual trust.
Pooled trusts are run by nonprofit organizations for the benefit of multiple beneficiaries. Assets from multiple families are pooled and invested together, and the funds are spent for the benefit of the individuals in proportion to their share of the entire trust.
Pooled trusts vary widely in terms of fees, available services, and contracts. Some provide complete care of beneficiaries, while others provide only appropriate money management.
Managers of pooled trusts must be knowledgeable about laws governing public benefits, and directors usually have relatives with special needs and understand the community’s needs. Pooled trusts give you the benefits of special needs trusts even if you do not have a lot of money to leave to a loved one.
On the other hand, pooled trusts can be expensive, and it can be difficult or impossible to move assets from one pooled trust to another. Also, they are only as good as their managers, and the nonprofits that run them may decline in quality of service or even go out of business if they face financial problems or changes in management.
The attorneys at Hook Law Center can help you decide what kind of special needs trust best suits your family.
Hook Law Center assists Virginia families with with guardianships and conservatorships, long-term care planning, special needs planning, veterans benefits, and more. To contact a Virginia Beach special needs planning lawyer or to learn more, visit http://www.hooklawcenter.com/ or call 757-399-7506.