You work hard to create a lifetime of continuous care for your loved one with disabilities, so it only makes sense that your employee benefits do the same. One of the first steps in this process is to understand how your employee benefits align with your vision of your loved one’s future.
Carefully consider who you name as a beneficiary
First things first, it’s best to avoid naming your loved one with special needs as a beneficiary on your 401(k), insurance policy or any other asset. Leaving as little as $2,000 could disqualify your loved one from receiving key government benefits, including:
- Supplemental Security Income,
- Federal housing assistance, and
- Supplemental Nutrition Assistance Program (SNAP).
An alternative is to create a special needs trust (SNT) and name the trust as the beneficiary to receive the proceeds. The funds in the trust can then be used to create the quality of life your loved one deserves without interfering with government benefits.
Take advantage of the employer match
Many companies encourage participation in their 401(k) by offering a company match. A company match is when your employer matches your retirement plan contributions dollar for dollar up to a certain percentage of your salary.If your contributions are less than your employer’s company match rate, you’re leaving money on the table that could be used to help create the future you envision for your loved one. Also, make sure to pay special attention to your beneficiary designations on your retirement account.
Add layers of financial protection with life insurance
Most companies offer life insurance as an employee benefit with the option to purchase additional coverage at a discount. You can utilize this additional coverage to fund your loved one’s SNT — giving you the peace of mind knowing you’ve taken the steps to help protect their future.
Plan for the unexpected with long-term disability insurance
If you were injured and could no longer work, how would you make ends meet today and plan the future you envision for your loved one with special needs? Long-term disability (LTD) insurance is designed to help you plan for an unexpected loss of income caused by injury, illness or an accident. You should also weigh the costs and benefits of increasing your LTD coverage, especially if you’re the primary earner in your home.
Extend your support with the employee assistance program
One of the most commonly overlooked and underused employee benefits is the employee assistance program (EAP). These programs may offer helpful assistance, information and solutions for a variety of personal situations, such as:
- Childcare and adult day care providers,
- Flexible work arrangements,
- Stress management seminars,
- Personal and legal counseling, and
- Several other services.
Save money today with health care spending accounts
Your loved one’s out-of-pocket healthcare costs can cause a significant financial strain — even with health insurance. However, you may be able to use Health Savings Accounts (HSAs) and/or Flexible Spending Accounts (FSAs) to set pre-tax money aside to cover many out-of-pocket medical expenses, such as:
- Developmental services,
- Doctor-recommended educational services, and
- Other qualified medical expenses.
Whether your loved one needs at-home care, after-school care or attends a daycare facility, these expenses can take a big bite out of your paycheck. Dependent care flexible spending accounts (DCFSA) are designed to minimize your out-of-pocket expenses and help save on the cost of care — something that’s rarely ever discounted. Just as with your HSA and FSA, contributions to your DCFSA are pretax, which means you’ll avoid paying federal, social security, Medicare and state taxes.Connect with a specially trained financial professional to learn more about creating a lifetime of continuous care for your loved one.