Money Management: Financial Planning for Your Child’s Future

Target Audience: Parents of children/young adults with special needs

Audience Profile
To understand how to assist parents with a special needs child, it may be helpful to
consider the challenges these parents face. For most families, financial planning
involves ensuring that they have enough money to pay the bills while at the same time
saving for their children’s college education and their own retirement. But for families
with special needs children, financial planning takes on a whole new, and often heart
wrenching, dimension.

The US Census Bureau estimates that more than one in ten Americans between the
ages of 16 and 64 suffers from some form of physical, mental or emotional impairment.
Special needs can range from disabilities that are obvious to those that are less evident.
For example, special needs can include medical conditions such as cerebral palsy. It
can mean physical conditions, such as blindness or the loss of a limb. And it can mean
neurological conditions, such as learning disabilities, mental retardation, or autism.

A 2005 study conducted by MetLife discovered that, “sixty percent of parents do not
expect their special needs children to ever be financially independent. Yet despite
recognizing that they are likely to die before their children, two-thirds (68%) of parents
have not written a will, and nearly one-third (29%) have done nothing at all to plan for
their children’s financial future.”

Additional information provided by the MetLife study indicates that the level of concern
cited by parents of children expected to remain dependent is out of sync with the actual
number who have done something meaningful in the way of securing their children’s
financial future.

The MetLife study suggests that while parents do want to do right by their children, they
simply do not have access to financial planning information that focuses on planning a
secure future for special needs children.

Where do parents turn for financial advice? Often times, they turn to sources that have
been helpful with medical issues—the medial profession and the Internet. Very few seek
advice from professionals such as attorneys, financial planners, investment advisors, or
insurance agents.

Program Overview
Parents of children with special needs children face day-to-day issues that are
sometimes overwhelming. Just getting through each day can be exhausting. There
never seem to be enough hours in the day to breathe, let alone plan for the future.
The key to this short program is to encourage participants to take steps now to secure
their children’s future by engaging in financial planning. This 60-minute program is
designed to provide participants with a few tools to make a plan for the future, write a
Letter of Intent, prepare a budget for future needs, and select a professional financial
planner.

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Facilitator’s Preparation:
 Review this guide and complete your own set of the accompanying
worksheets.
 Review the suggested length for each topic noted as (10) or (15) and so on.
This session is designed to be 60 minutes (1 hour) from Welcome to Wrap.
 Consider your own situation. Do you have a person in your life with special
needs? Do you know anyone who has a child with special needs? How
would you cope with all of the issues regarding caring for a child with special
needs? Would you be worried about the future?
 Think about your own money management behavior. Are you prepared for
your financial future? If you have dependents, have you planned for their
future when you’re not around? Are there some money management lessons
learned from your own experiences that may be helpful to share?
 Consider that when it comes to talking about money, sharing your own
successes and challenges may be more engaging and effective than
appearing to be lecturing.

Materials Needed:

 Flip chart and easel or marker board; markers

 Pencils for participants
 Copies of Planning for the Future worksheet
 Copies of Letter of Intent Outline worksheet
 Copies of My Child’s Future Spending Plan worksheet
 Copies of Questions to Ask… information sheet
 Copies of My Action Plan worksheet

How to Facilitate this Session

Welcome
(8) Introduce yourself and express your pleasure in sharing money
management tools that can be used for financial planning.

 Have each participant introduce him/herself and share one current

financial worry about his/her child’s future. List the worries on the flip
chart or marker board.

 Share the program objectives and tie them back to the list of worries.
• Plan for the future
• Write a Letter of Intent
• Create a budget for future needs
• Select a professional financial planner
• Commit to an action plan

Planning for the future…

(25) Explain to participants that just as their children are not exactly the same,
their financial situations are unique. However, each of them shares the
same desire to protect their child’s inheritance and ensure that he or she
is taken care of after they die.

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 ?Ask participants how many of them feel a bit overwhelmed by the
prospect of planning for their child’s future, while they are managing their
day-to-day lives.

 Explain that the first step to balancing the present and the future is to
answer a series of questions that will help them focus on what needs to
be done. In some cases, they may be able to answer the question in the
affirmative, in other cases, they may not have even thought about the
question. The important thing is to begin planning for the future!

 Distribute Planning for the Future worksheets. Direct participants to take

the next 7-9 minutes to complete the worksheet.

 When time is up, divide the group into small groups of 3-5. Encourage
participants to share their responses in their small groups. Allow for 10-
15 minutes for participants to share.

 Suggest that these are tough questions and require critical choices and
decisions.

?Ask participants to indicate by a show of hands how many of them have

written a Letter of Intent.

Letter of Intent
(8) 
 Explain that Letter of Intent is a document written by the parents or
guardians of a child with special needs that describes the child's medical
history, the child's current situation, and what they hope for the child's
future. This letter should be started as soon as possible and updated as
their child grows. The Letter is then ready at any moment should they
become ill, disabled, or they pass away.

 Suggest that preparing the Letter is often a very emotional experience for
parents. The process is not an easy one and it may take several months
to complete. Once the Letter is completed, they should have it witnessed
and notarized. In addition, it should be formally updated about every six
months.

 Distribute Letter of Intent Outline worksheet. Review each area and

answer any questions. (Encourage participants who may have written a
Letter of Intent to share their experiences and advice.) Explain that the
Letter may be written in any format.

 Stress that the Letter is one thing they should not procrastinate about.
Sometimes people feel that the odds of something happening to them are
slim. But take a moment and think—if they are the primary caretakers of
their child with special needs, would their spouse really know how to do
everything? If something were to happen to both parents, who would
know what kind of care their child needs and deserves?

?Ask participants how many of them use a spending plan to track their
income and expenses on a monthly basis.

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Budgeting for the Future
(8) Explain that while it’s important to create a monthly spending plan to
manage today’s expenses, it’s even more important to create a future
spending plan for their child.

 Explain that before participants engage in financial planning for their child,
they need to identify their child’s sources of income and expenses.

 Distribute My Child’s Future Spending Plan worksheets. Review each

section and answer any questions.

 Explain that once participants have identified the total expenses and
income, they’ll be able to determine if presently they have enough money
to set aside so that if anything were to happen, their child or other
dependent with special needs could continue to lead the quality of life
they have planned for him or her.

 Stress that like most financial plans, however, things can always change
and all plans should be re-considered, and if necessary updated on an
annual basis.

?Ask participants if they are currently working with a professional

investment adviser.

Selecting an Investment Professional

(5) Suggest that as participants begin to plan for their child’s financial future,
they may want to seek the help of an investment professional.

 Stress that before participants meet with an investment professional, they

should draw up a list of questions. They should always meet face-to-face!

 Distribute Questions to Ask… information sheet. Review the four areas

of concern and the suggested questions. Answer any questions.

Wrap
(5) Review the list of worries and note which ones were addressed and which
ones will need to be addressed at a later time.

 Review the topics covered in the session:

 Planning for your child’s future
 Writing a Letter of Intent
 Creating a future spending plan for your child
 Identifying the need for supplemental income
 Selecting an investment professional

 Remind participants to review the questions posed on the Planning for

the Future worksheet.

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  Encourage participants to sit down in the next week and start to write their
Letter of Intent.

 Encourage participants to complete their My Child’s Future Spending

Plan worksheets.

 Distribute My Action Plan worksheets. Encourage participants to take a

few minutes to complete their worksheets to ensure that they get started
planning for their children’s financial future immediately

 Thank participants for their attendance and let them know how much you
enjoyed spending an hour with them. Provide them with any additional
information as agreed upon with your agency contact.

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 Planning
for
the
Future

1. Do you or your spouse have a vision of how your child will live if both of you are not around?

2. Have you identified a guardian, conservator, or trustee for your child?

3. Do you have a complete understanding of Supplemental Security Income (SSI) or Social

Security Disability Insurance (SSDI) government benefits?

4. Have you begun setting aside money for your child with special needs?

5. Do you have a written Letter of Intent?

6. Have any of your children, with or without special needs, been excluded in your will?

7. Do you have a special needs or supplementary trust set up to preserve government benefits?

8. Have you made provisions to fund these trusts with assets or insurance?

9. Have you coordinated your special needs planning with other relatives?

10. Have you done everything possible to protect your child's financial future?

11. Have you planned where your special needs child will live if you are not around?

12. Will your child be able to earn enough to care for him or herself?

13. Will your child have adequate health insurance?

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 Letter of Intent Outline
The letter can be addressed to anyone you wish. For example, “To Whom it May Concern,” “To
My Guardian(s), Trustee(s), and Executor.” The letter should address everything that is important
in your child’s life: residential, social, community, integration, religion, employment, likes and
dislikes, food preferences, medical, behavior management, names of guardians/advocates,
trustees who will manage your child’s estate—even such things as information on preferred
sleeping positions or favorite music.

 Family History
Where and when you and your spouse were born, raised, married, something special
about grandparents, siblings, and other relatives, special friends, description of your
child’s birth, when, where, your feelings, etc.
 General Overview
A brief overview of your child’s life to date and your general feelings about the future.
 Education
Summary of past educational experiences and desires for future education; regular
classes, special classes, special schools, mainstreaming, extra curricular activities;
educational emphasis—academic, career and technical; names of specific programs,
schools, teachers, related service providers.
 Employment
Types of work your child might enjoy; sheltered workshop, open employment with
supervision, activity center; companies that you are aware of that may be of interest to
your child and provide employment in your community.
 Future Residence
Specify if your child is to live with relatives or friends and provide names and addresses;
if not these people or these people die, your other options such as group home or
institution in same community—describe the best living arrangement.
 Social
List types of social activities your child enjoys; indicate whether he or she should have
spending money and how he or she should spend it; list favorite foods and eating habits;
explain if your child takes and enjoys vacations.
 Religious/Spiritual Life
Specify religion; local place of worship your family attends; local clergy that may be
familiar with your family; any religious education that should be provided.
 Medical Care
List diagnoses, immunizations, surgeries, illnesses, seizures, levels of functioning, vision,
hearing, speech, mobility, blood type, insurance, allergies, birth control; current
medications, how administered, for what purpose; describe medications that have not
worked in the past; list current doctors, therapists, clinics, hospitals, etc., and how often
your child attends and for what purpose.
 Behavior Management
Describe current behavior management program that is being used; outline behavior
management programs that have not worked.
 Financial Information
List assets, income, services and benefits, expenses and changes that will occur upon
the death of both parents.
 Final Arrangements
List any prearrangements you have made and/or desires for your child’s funeral
arrangements; choice of funeral home, cremation or burial, cemetery, monument,
religious service and clergy.
 Additional Information
Include any other information you feel will ensure your child’s best possible care.

Note: Once you write the letter, both parents should sign and date it. Each year, take it out and
add to it or revise it and sign and date the changes. Remember, this is not a binding,
legal document. However, it provides guidance and it speaks for both the family and the
child.

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 My Child’s Future Spending Plan
The goal of completing this worksheet is to raise your awareness of the amount of money your
child with special needs might need if both parents are deceased. It is designed to help you plan
for lifetime care AND quality of life so that you can determine how to fund a special needs trust,
and provide you with some idea of how much you will need.

Housing/Living
Monthly Expenses Annual Expenses
Rent/Mortgage $ $
Utilities $ $
Other $ $
Total Housing/Living Expenses $
Care Assistance
Monthly Expenses Annual Expenses
Respite Care $ $
Custodial Care $ $
Nursing Care $ $
Other $ $
Total Care Assistance Expenses $
Personal Needs
Monthly Expenses Annual Expenses
Personal Grooming $ $
Other (Clothes, shoes, etc.) $ $
Total Personal Needs Expenses $
Education and Employment
Monthly Expenses Annual Expenses
Transportation $ $
Uniform/Dry Cleaning $ $
Tutoring/Job Assistance $ $
Meals $ $
Other $ $
Tuition/Fees (annual) $
Books/Supplies (annual) $
Other annual expenses $
Total Education and Employment Expenses $
Special Equipment
Annual Expenses
Wheelchair/Assistive Technology
Specialized Computer Equipment
Durable Medical Equipment
Books in Alternative Format
Service Animals
Technical Instruction
Other
Total Special Equipment Expenses $
Medical/Dental/Vision Care
Monthly Expenses Annual Expenses
Doctor Visits $ $
Prescription Drugs $ $
Therapy (Speech, Occupational, Physical, other) $ $
Over the counter medications $ $
Transportation $ $
Insurance premiums $ $
Other $ $
Total Medical/Dental/Vision Care Expenses $

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Social/Recreational
Monthly Expenses Annual Expenses
Internet/Cable TV $ $
DVDs, Movies, etc. $ $
Vacations $ $
Camp Costs $ $
Sporting Events $ $
Total Social/Recreational Expenses $
Miscellaneous
Annual Expenses
Total Miscellaneous Expenses $

Income for Child with Special Needs

Monthly Annual
Government Benefits (SSI, SSDI) $ $
Wages $ $
Other $ $
Total Income $
Income Received at Death of One Parent or Caregiver
Lump Sum Amount* Annual Income
from Assets
Investments $ $
Life Insurance Proceeds $ $
Other Assets $ $
Total Income $
*Please remember to keep in mind any other children or beneficiaries, and do not include the portion of your
estate that will be left to them. Only include the amount you know will be available for this individual in this
calculation.
Income Received at Death of Both Parents (do not double count assets listed at death of one
parent)
Lump Sum Amount* Annual Income
from Assets
Investments $ $
Life Insurance Proceeds $ $
Other Assets $ $
Total Income $
*Please remember to keep in mind any other children or beneficiaries, and do not include the portion of your
estate that will be left to them. Only include the amount you know will be available for this individual in this
calculation

Total Annual Expenses $

Total Annual Income $

Supplementary Needs
Annual Supplementary Needs $

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 Questions to Ask…
There should be a good fit between you and the investment professional you choose to
handle your financial affairs. Interview at least three or four individuals. Before you meet
with an investment professional, you will want to draw up a number of questions to help
you make the right selection. Here are four areas to consider along with a few
questions— feel free to add more questions!

Education and Training

A college degree is not required of an investment professional, although many have

advanced degrees. Some professionals are required to be licensed, certified, or
complete extensive training.

Know what credentials your investment professional must have before you invest. Visit
FINRA’s professional designation database. Find out the education and experience
various investment professionals must have, the examinations they must pass, and if
they are in good standing.

• What type of education and training do you have?

• What examinations did you take? Did you pass them?

• What licenses or certifications do you have? May I see them?

• Are you registered with the SEC, a state, or FINRA?

Experience

Ideally, you’ll find an investment professional who has experience working with parents
with a special needs child. A professional who understands your situation and the
various regulatory and legal issues associated with caring for a special needs child will
serve you well. Most importantly, you want to be sure, without a shadow of a doubt, that
you end up working with a legitimate upstanding professional.

• Have you ever worked with a client who has a special needs child?

• Are you familiar with medical plans, government and private disability benefits,
and life insurance?

• Are you familiar with the legal rights of people with disabilities?

• Have you ever heard of a Special Needs Trust?

• How long have you been in the investment business?

• Where did you work prior to this position? What is the status of those firms
today?

• Have you ever been charged with any wrongdoing or disciplined by a regulator?

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Approach to Investing

Determine whether an investment professional will act in your best financial interest.
That means respecting your financial goals, tolerance for risk, and need to access your
money if necessary.

• What is your investment philosophy?

• Can you give me the contact information of long-term clients?

• How often will you review my finances?

• Do you recommend certain products? What are all the products and services
you offer?

• Knowing my financial goals, how would you approach helping me meet them?
• How do you decide how my money should be allocated?

Fees and Commissions

• How do you get paid (fee, commission from sale of financial products, fee plus
commission)?

• On the investment products you sell, what is the rate of commission you get
paid?

• Would I pay commission when I buy an investment or when I sell it?

• Does anybody else get paid when I purchase an investment or are you rewarded
with a prize for selling an investment?

Note:

For any investment professional you are interested in working with, do a background
check before your first transaction. Look for proper registration, licensing, or certification,
as well as disciplinary history. Do not simply rely on family and friends for a
recommendation!

Remember, your goal is to identify an investment professional you trust—who has the
right skills to help you meet your financial goals, make sound decisions, and monitor
your investments. If you have a concern or your gut suggests that this person is not for
you—walk away.

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 My Action Plan
Main message for me from this session:

My personal commitment to action:

Obstacles that may get in my way:

What I need to do to succeed:

Use Limitations. These materials are intended for non-commercial educational and instructional use only. These
materials may not be used in connection with any sale, advertisement, endorsement or promotion of any service,
product, person or business and may not be commercially published, sold or offered for sale.

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