292 Payneham Road, Payneham SA 5070

(08) 8362 0060

(08) 8362 0061

info@owlfinancial.com.au

Planning for the future of a special needs child

Planning for the future of a special needs child

While estate planning is essential for any parent, it takes on additional significance for the parents of a child with special needs. One of your biggest concerns is probably planning for their future care when you are no longer there to look after them.

There is a lot to consider and each child’s needs are unique, depending on the nature of their disability and the level of ongoing support they will need. Any plan you put in place is likely to consider things such as where they will live, who will care for them on a day to day basis and how you can safeguard their financial interests.

Not only do you need to make sure your child receives the same level of support in your absence, but you also want to set in place a strategy that is transparent and allows all your children to thrive.

As best you can, try to plan for the long haul, protecting your child from any future changes to circumstances or legislation as well as taking stock of how their personal needs will change over their lifetime. You also don’t want to jeopardise their eligibility for any government benefits.

The matter of trusts

One of the big concerns for parents is that their child may not be capable of managing their own finances. One way around this is to establish a testamentary trust as part of your Will.

If your child is severely disabled, over the age of 16, and you are concerned that the money you leave them could reduce their social security benefits, you might consider a Special Disability Trust. This will not only provide for them, but the money and income will not be subject to any means test as long as the amount invested is under an inflation-adjusted cap.

As at 1 July 2018, the cap is $669,750. Plus, you can spend up to $12,000 a year on expenses unrelated to their care and accommodation needs.

Other types of trust include a capital reserved trust, where the individual can receive income from the trust and use the trust’s asset such as the home during their lifetime, and a protective trust, where the trustee can apply income and capital to the trust over its lifetime if more funds are needed for their wellbeing.

Other considerations

You need to maintain a very long-term view and think about what will happen to your estate when your special needs child dies and whether they will be capable of making decisions on its distribution. It may be a good idea to have a clause in a trust that says the money should go to your surviving family members.

The choice of trustees is also important. In most cases, Australian law dictates that there will need to be more than one, and while it may seem natural to appoint your other children as trustees, in general it is wise to choose someone outside of the family to avoid conflicts of interest.

While appointing an external trustee can be a more expensive option, if you select the right person, you can have confidence in their empathy and financial acuity. With the correct structures in place, your child or their carers can also be involved in financial decisions, if appropriate.

Super plays a role

In some circumstances your super can also be used to provide ongoing support. If your child is considered to have a severe disability, you can pass your superannuation money on to them as an income stream regardless of their age.

It takes careful and considered planning to provide properly for a loved one with a disability, beyond your lifetime. It’s also important to review your plan frequently, making adjustments when legislation or your child’s circumstances change.

We can assist and are here for you and your family, now and into the future.

Read more from our October 2018 update here:

Contact us on 0883620060 to discuss your existing financial plan

Owl Financial Management (OwlFM) is an Adelaide based Financial Planner that has clients all over Australia.



Financial Advisor Adelaide

We are an award winning practice that has been providing financial advice to South Australians since 1969. We really enjoy getting to know our clients and building a relationship with them that lasts over many years. We have a diverse range of clients from mum and dad to AFL players to ASX CEOs. All of which have a diverse range of financial advice needs and very different relationships to maintain. Our clients describe a 'breath of fresh air', personable, expert and people with high integrity. Clients have also mentioned that they are not treated as a number and the advice is specific to them. Working with clients for clients.

Financial Planner Adelaide

The one most rewarding thing about being a financial planner in Adelaide is when you have been working collaboratively with a client in developing and building their goals and objectives and the come to fruition. This give both the clients and myself a real sense of achievement and to use the famous quote 'are we there yet?' and together we can say YES! There has never been a better time to look towards what you want to achieve and start a financial plan so you can get there too.

Financial Planning Adelaide

A person's financial story is like a jigsaw puzzle... "lots of pieces needing to be put into their correct places". A financial adviser can assist a client to put the pieces in the right places by having a series of simple conversations about where a they are currently situated, where they want to be and what strategies can assist them. Every client has a different financial story and goals. Each jigsaw puzzle will always be different. A good financial adviser is experienced at putting together a wide range of jigsaw puzzles. Helping a client put their own puzzle together and seeing their satisfaction is a wonderful feeling.


Barry Phillis, Chris Scriva, Paul Cetrangolo and Owl Financial Management Pty Ltd are Authorised Representatives of GWM Adviser Services Limited Australian Financial Services Licensee Registered Office at 105-153 Miller Street North Sydney NSW 2060 and a member of the National Australia group of companies.

GENERAL ADVICE WARNING: The advice on this site may not be suitable to you because it contains general advice that has not been tailored to your personal circumstances. Please seek personal financial advice prior to acting on this information.

Opinions constitute our judgment at the time of issue and are subject to change. Neither, the Licensee or any of the National Australia group of companies, nor their employees or directors give any warranty of accuracy, nor accept any responsibility for errors or omissions in this document. View Terms & Conditions >