For use with your clients

America’s new retirement reality

Member for

1 year 7 months
Submitted by Matt Stagner on Wed, 06/02/2021 - 14:14

Voya Cares has been watching the demographic and societal trends shaping our country — especially two fast-growing groups who have been particularly impacted by the pandemic: Sandwich Caregivers and Career Extenders.

“Sandwich Caregivers” provide unpaid care to an adult while also caring for children living in their home. As of 2019, there were 11 million of them or 28% of all caregivers**.

"Career Extenders" are working longer because they either enjoy the stimulation that their careers provide or do not have the resources to retire. Nearly 20% of Americans over age 65 — a total of 10.6 million people — are either working or looking for work, representing a 57-year high.+

Our just-launched position paper digs in to the emerging trends that are causing these two groups to grow, examines how their futures are being impacted, and most importantly, proposes how we can help them prepare for a secure financial future.

Traditional advice urges Americans to begin preparing early for retirement, targeting 80% of their pre-retirement annual income over a 25 year retirement period, and planning for an annual withdrawal of 4% of total investments++. However that advice misses the mark for Career Extenders and Sandwich Caregivers.

The Voya Cares® program recognizes, however, that many of the tenets of special needs financial planning can be applied for these two groups, emphasizing the use of government benefits in coordination with employee benefits to supplement available assets.

The first step on the road to a secure retirement is awareness and education to help both those in the financial services industry, as well as Career Extenders and Sandwich Caregivers themselves, recognize their unique circumstances. Educational materials and step-by-step guidance tailored to their unique challenges should be readily available when and where they need them.

Education and guidance must be backed up with tangible, specific solutions needed to help Sandwich Caregivers and Career Extenders prepare a long-term plan for the future. The following existing or developing solutions may be particularly useful:

  • Employee benefits offerings, like medical insurance coverage, health savings and flexible spending accounts, leave management programs, employer-paid back-up care and employee assistance programs can help to free up resources for retirement savings while positively impacting quality of life.
  • Government benefits offerings may provide assistance with income, medical, residential, educational and vocational needs. Coordinating employee and government benefits may help better leverage existing assets.
  • Debt mitigation programs, especially student loan debt, can be particularly helpful for people who are nearing retirement, since they have the greatest debt.
  • Emergency savings solutions enable individuals to build retirement savings while also being able to absorb short-term financial shocks and disruptions in income.
  • ABLE accounts can be a great way to set aside savings for eligible children and adults with disabilities, lessening the need for withdrawals from accounts earmarked solely for retirement.
  • Individual Retirement Accounts (IRAs) and Roth IRAs are ways to put away money outside of a pension plan to supplement retirement income, and the income paid out from Roth IRAs also is tax free to help boost “take-home pay” in retirement.

To learn more about how Sandwich Caregivers and Career Extenders are unique in the challenges that they face when planning for their future health and wealth and how and the Voya Cares program is distinctively positioned to lead the conversation addressing these challenges, see America’s new retirement reality: COVID-19 amplifies demographic and societal trends, foreshadowing challenges that more Americans will face on the road to a financially secure retirement.

Subtitle
COVID and demographic trends foreshadow challenges to a financially secure retirement
Compliance Code
CN1674595_0623
Business Owner
Mathew Stagner
Expiration Date
Older couple enjoy gardening together
Individuals Employers Financial Professionals Planning for life’s milestones For use with your employees For use with your clients Retirement

Products and services are offered through the Voya® family of companies.

*Schneider, Mike. ”By 2060, a quarter of U.S. residents will be over age 65.” February 13, 2020. By 2060, a quarter of U.S. residents will be over age 65 (apnews.com)

**“Burning the Candle at Both Ends: Sandwich Generation Caregiving in the U.S.”, The National Alliance for Caregiving (NAC), November 2019.

+According to the Census Bureau and Bureau of Labor Statistics (BLS), analyzed by investment and financial-planning firm United Income and reported in Business Insider, April 29, 2019: Loudenback, Tanza. “One-fifth of older Americans are working past 'retirement age’, and it’s not because they can’t afford to retire.” https://www.businessinsider.com/personal-finance/baby-boomers-working-past-retirement-age-healthier-2019-4

++Waggoner, John. “How Much Money Do You Need to Retire?” AARP, Jan. 6, 2021. https://www.aarp.org/retirement/planning-for-retirement/info-2020/how-much-money-do-you-need-to-retire.html

Short Title
America’s new retirement reality

Checklist for employers to help be more inclusive of the disabilities community

Member for

1 year 7 months
Submitted by Matt Stagner on Tue, 01/12/2021 - 13:54
  • Nearly 66 million Americans — one in five — care for an aging, seriously ill, or disabled family member or friend¹.
  • Three in four employers report caregivers being stressed at work as an issue for their company².

Employers can make a difference by being inclusive of employees with disabilities and employees with caregiving responsibilities. From inclusive hiring practices, to communication, to employee benefits, this checklist can be a guide to see where your company is today, and where you might be able to improve.

To-do items for employers:

  • Build a culture of understanding.
    • Help individuals with disabilities and caregivers feel comfortable disclosing their disability or special needs situation.
  • Provide support groups for caregivers and employee assistance programs (EAPs).
  • Help make sure caregivers and employees with disabilities know they aren’t alone.
  • Build inclusive hiring and employment practices.
    • Include accessible workspaces, technology, and participate in the Disability Equality Index at DisabilityIN.
  • Include guidance and language for beneficiary planning.
  • Educate employees about potential ramifications to government benefits eligibility.
  • Focus on flexible work schedules and paid family leave.
    • Help employees who are in need of time away from work, but depend on their income to make ends meet, to balance their work and caregiving responsibilities.
  • Review existing employee benefits package.
    • Demonstrate to employees how to make the most of the valuable benefits already offered.
  • Offer special needs planning resources and financial planning guidance.
    • Financial wellness programs
    • Online tools for document creation and storage, including Letter of Intent and special needs trusts
    • Informational resources like Voyacares.com
  • Offer benefits that are of specific interest to employees with disabilities and caregivers.
    • ABLE accounts
    • Paid caregiver leave
    • Care coordination programs

Download a copy of this Caregiver Employer Checklist (PDF).

Learn more about these strategies and how to implement them in your organization with our whitepaper.

Subtitle
Attract, retain, and support employees with disabilities and caregivers
Compliance Code
CN941582_0920
Business Owner
Mathew Stagner
Expiration Date
A group of small/mid-size business owners learning about the benefits of their retirement plan
Employers Workplace benefits and special needs planning For use with your clients Retirement

Not FDIC/NCUA/NCUSIF Insured | Not a Deposit of a Bank/Credit Union | May Lose Value | Not Back/Credit Union Guaranteed | Not insured by Any Federal Government Agency

Neither Voya® nor its affiliated companies or representatives provide tax or legal advice. Please consult a tax adviser or attorney before making a tax-related investment/insurance decision. Products and services offered through the Voya® family of companies.

  1. U.S. Department of Health and Human Services. Caregiver Resources & Long-Term Care (2017)
  2. Findings of an online survey of 510 HR Decision Makers respondents and an online survey of 1,815 employee respondents, both conducted by Voya Cares® in partnership with Lieberman Research Worldwide (LRW) during the period of December 2, 2018 – January 14, 2019
  3. Brandon Rigoni and Bailey Nelson, “Many Millennials Are Job-Hoppers – But Not All,” Gallup, 8/9/2016
Short Title
Voya Cares checklist for employers

ABLE accounts at a glance

Member for

1 year 10 months
Submitted by smoses on Fri, 11/20/2020 - 17:12
Subtitle
Achieving a better life experience
Compliance Code
CN956858_0920
Business Owner
Mathew Stagner
Expiration Date
Family of four walking and paying along beach
Individuals Employers Financial Professionals Special needs planning essentials Special needs planning essentials For use with your clients For use with your employees
Short Title
ABLE accounts at a glance

Add an HSA to a Special Needs Financial Plan

Member for

1 year 10 months
Submitted by smoses on Fri, 11/20/2020 - 16:36

What is an HSA?

A Health Savings Account (HSA) is a way to increase your spendable income and save money on taxes. HSAs work with a high-deductible health plan to help you invest for future expenses while paying for everyday costs like copays, prescriptions and more. You can use the account for all eligible out-of-pocket medical expenses, including those for your covered spouse and dependents.

How does an HSA work?

The IRS sets an annual per-person or per-family limit that you and your employer can agree to meet. Then, your pre-tax dollars are transferred into the account every month. If you contribute the maximum amount allowed each year, you’ll fully benefit from the tax savings, withdraw funds anytime you need them, and continue to save for the future.

Should I assign beneficiaries?

If your loved one with disabilities qualifies for government benefits, an HSA under their name can disqualify them. Consider a Special Needs Trust (SNT) or an ABLE account for your loved one, as it can stand in as the beneficiary for your HSA and any other financial assets, without putting government benefits at risk.

Am I eligible for an HSA?

You may be a great fit for an HSA if you have:

  • Qualifying High-Deductible Health Plan (HDHP) coverage.
  • Medical expenses to plan and pay for, like copays.
  • A desire to save and invest for your retirement.
  • A plan for your own or a loved ones’ future care.

Plan for special needs with an HSA

HSA benefit: Triple-tax advantaged.

Special needs application: Your HSA grows with you, tax-free. Pre-tax contributions reduce your taxable income, and withdrawals for eligible expenses are not taxed. When it comes to means-tested government benefits, however, contributing to an HSA doesn’t reduce your countable income, and HSA funds will count as resources, so plan accordingly. An HSA in the name of a caregiver can be a valuable planning tool for expenses related to a covered dependent. Always consult with your specialist advisor and attorney to understand the rules related to government benefits.

HSA benefit: Works well with others.

Special needs application: Pair with a Flexible Spending Account (FSA). If you’re not eligible for an HSA or you want to complement one, a tax-advantaged FSA allows you to save and spend money on eligible medical expenses and dependent care throughout the year. But unlike an HSA, the funds don’t roll over — so they’re not accruing interest or available over time. You can use your FSA for shorter term expenses, and build up HSA investments for the long term.

Pair with an ABLE account. An ABLE account is another way to save and spend for disability-related expenses, similar to a special needs trust. Like an HSA, an ABLE account has some tax advantages and can be used for short-term spending or long-term investing. The main difference in taxation is that the HSA is funded with pre-tax funds, while the ABLE account is after-tax. Of course, the allowable expenses are different, and ABLE accounts are not counted as assets for means-tested benefits. Used properly, ABLE and HSA accounts can work together as you manage your cash flow now and in the future.

HSA benefit: Supplement health insurance benefits.

Special needs application: Your health insurance plan may cover your minor children and adult dependents with disabilities, but the deductible and copays might make cash flow difficult. And, your health insurance coverage might exclude some necessities for your loved one with disabilities or special needs. An HSA is there to help fill in the gaps.

An HSA can be used to pay for emerging technologies, experimental drugs and other medical related expenses that your insurance may not cover. If your doctor orders or prescribes it, you should be able to pay for it with an HSA. This can include things like home modifications, ABA therapies, special diets, vitamins, autism programs and more.

HSA benefit: Rollover funds.

Special needs application: You may not know what the future holds in terms of expenses for your loved one with special needs or disabilities, so accumulating savings in an HSA is a great way to stay prepared. Your HSA account and funds stay with you, even if you change jobs. Funds can be rolled over, so you’ll never have to “use-it-or-lose-it.” In a special needs situation this is especially helpful, because dependents may be able to stay on a parents’ plan beyond typical ages, so the benefits may span multiple jobs for the covered worker. This feature makes your HSA another source of resources for a lifetime of care.

HSA benefit: Save into retirement.

Special needs application: An HSA can be a valuable retirement savings vehicle since unused funds can be invested and grow for the long term. Caregivers who are trying to balance saving for their own retirement with providing care may find this option helpful.

If you or your covered dependent is on Medicare, you’ll be able to use HSA funds to help pay for the premiums, as well as for long-term care policies.

Plan ahead by saving your receipts. If you don’t need the reimbursements now, or at the time of the medical care — you can take them out later, even well into your retirement years.

HSA benefit: Debit card and/or easy online access.

Special needs application: If you’re an individual with special needs or a caregiver for a person with a disability, you know that keeping good records is key. HSAs help you keep track of every penny saved and spent with online profiles and debit cards that are simple to access and use.

Action steps:

Learn more

Subtitle
Learn how to use an HSA within your financial plan, especially if you’re a caregiver for a person with a disability.
Compliance Code
CN#1376647
Business Owner
Mathew Stagner
Expiration Date
Father facing and engaging baby who is sitting on bed
Employers Financial Professionals Individuals Maximizing employer benefits Special needs planning essentials Special needs planning essentials For use with your employees For use with your clients
Short Title
Add an HSA to a Special Needs Financial Plan

How to talk to your family about your special needs trust (SNT)

Member for

1 year 10 months
Submitted by smoses on Thu, 09/03/2020 - 10:14

Setting up a special needs trust (SNT) for your loved ones with a disability or special needs is a good way to protect their government benefit eligibility after you are gone. But if your family members aren’t aware of your good financial and legal planning, an inheritance or other gift from them may impact your loved ones’ future.

Bring everyone to the table

Whether your family is very open about money, or they keep to themselves about finances, it’s important to have an open conversation. If people are comfortable, forming and managing an SNT can be a family process. Once you have contacted your special needs attorney and set the plan in place, sit down with your family members, communicate plans and get them involved.

Talk about why

It’s important that everyone understands very clearly that any inheritance or gift of money that goes directly to a person with disabilities who is receiving government benefits could be devastating. List the government benefits your loved one receives or will receive, and let your family know that your loved one could lose those government benefits, if he or she receives other income or assets.

Talk about what

Explain that you’ve found a way they can still leave an inheritance or gift money to your loved one. Let them know that simply designating your loved one’s SNT as the beneficiary for any financial asset will avoid the problem of losing government benefits. Then, give your family members the title of the trust, so it can be named as a beneficiary.

Talk about how you feel

Your family may have questions and concerns. Try to be patient and responsive. For the process to work, everyone needs to feel heard and accepted and have a clear understanding of the importance of the SNT to the beneficiary.

Get organized

Make sure you store the trust information, along with guardianship documents, powers of attorney, wills and other important papers, in a safe place. You may need to access these papers occasionally, so having them in a central location — or as electronic copies in a digital vault — could make your life easier. In addition, your family members (especially those who may be successor trustees or caregivers) need to be able to find everything, in case something happens to you. Get everything organized and communicate where the family can find information, if needed. This step is often overlooked but can make a big difference.

Action steps:

  • Talk to a financial advisor to get started.
  • Find a special needs attorney.
  • Set up your special needs trust (SNT).
  • Give your family the title of the special needs trust.
  • Get organized.

Learn more:

 

Compliance Code
CN1376647_1022
Business Owner
Mathew Stagner
Expiration Date
Five diverse team members collaborating during a meeting.
Employers Financial Professionals Individuals Special needs planning essentials Special needs planning essentials For use with your clients For use with your employees

Neither Voya Financial® or its affiliated companies or representatives offer legal or tax advice. Please seek the advice of a tax attorney or tax advisor prior to making a tax-related insurance/investment decision.  

Products and services offered through the Voya ® family of companies.

Short Title
How to talk to your family about your special needs trust (SNT)

Setting up a special needs trust (SNT)

Member for

1 year 10 months
Submitted by smoses on Thu, 09/03/2020 - 10:02

Setting up a special needs trust (SNT) for a person with a disability or special needs named as the beneficiary may be an important step to preserving your loved one’s government benefit eligibility. To get started, follow these steps:

  1. Contact a financial planner who is experienced in planning for special needs.
  2. Take inventory of your assets, including future inheritances your loved one might receive, property sales he or she may benefit from, or income that might be earned.
  3. Capture specific goals for your loved one by creating a Letter of Intent (LOI). An LOI gives you a big picture of your loved ones’ future care needs — for example the cost of housing, food and other expenses — and helps create a vision for their future.
  4. Calculate how much funding you will need for your loved ones’ SNT by balancing the needs of the present and the future — daily life, retirement savings, travel, college and life goals. Factor in taxes, inflation and administrative costs. Err on the conservative side, and round up.
  5. Enter a collaborative process as your financial advisor calculates numbers based on your and your loved ones’ goals and available assets. Confirm what’s realistic and comfortable for your family. As you go through the process, you’ll be able to fill in any gaps with life insurance benefits, potential earned income from your loved one and other funds.
  6. Meet with a qualified special needs attorney to draft the documents. Be sure to find a special needs attorney with specific experience planning for those with disabilities.
  7. Select a trustee or trustees to be responsible for filing the trust taxes, administrating the trust, and understanding what’s allowable for trust distributions, according to its documents. Often parents will name themselves as trustees, but they’ll still need to decide who will manage the trust, once they pass away, so the decision on successor trustees is critical. Name successor trustees from multiple generations to make sure the role is filled for the long term. While many people automatically appoint other family members as successor trustees, family dynamics may sometimes get in the way of clear financial decision-making. In many cases, a professional trust administrator is a good alternative.
  8. Consider assigning co-trustees [optional]. You, a family member and a professional trustee can be co-trustees of the SNT. For a fee, the professional can be sure all actions are compliant with the law and send out distributions, while the family member can look out for the best interest of your loved one. A trust protector — someone appointed to watch over a trust over time to ensure that it is not adversely affected by any changes in the law or circumstances — could also be added, to oversee all the work.
  9. Create an informal committee [optional]. The people who can be involved on your SNT committee include the trust protector, the trustee or co-trustees, your loved one’s doctor, your special needs attorney, other family members, the person who has power of attorney, your loved one and yourself. Each committee member will know the beneficiary well and will be able to guide the trustees in decision making that is in the best interest of your loved one with a disability or special needs.
  10. Make the SNT a beneficiary. Once the SNT is legally in place, simply add it to your financial assets that have your loved one with a disability or special need named as a beneficiary, such as life insurance and pension plans.

Action steps:

  • Talk to a financial advisor to get started.
  • Create a Letter of Intent (LOI).
  • Find a special needs attorney.
  • Appoint trustees, co-trustees and successors to the SNT.

Learn more:

Compliance Code
CN1376647_1022
Business Owner
Mathew Stagner
Expiration Date
Businesswoman using digital tablet at office desk
Employers Financial Professionals Individuals Special needs planning essentials Special needs planning essentials For use with your clients For use with your employees

Neither Voya Financial® or its affiliated companies or representatives offer legal or tax advice. Please seek the advice of a tax attorney or tax advisor prior to making a tax-related insurance/investment decision.

Products and services offered through the Voya® family of companies.

Short Title
Setting up a special needs trust (SNT)

Types of special needs trusts (SNTs)

Member for

1 year 10 months
Submitted by smoses on Thu, 09/03/2020 - 09:53

A special needs trust (SNT) is a legal document drawn up by an attorney with special needs experience. A properly drafted SNT can receive assets for the benefit of the beneficiary.

When it’s time for the assets to be distributed, your loved ones can receive the SNT funds without losing their government benefits in the process. The following information can help you choose the right SNT for your situation.

First-party trust

If you are a person with disabilities or special needs, you can set up a first party special needs trust. Add to it your unexpected inheritances, child support and even structured settlement money. This will protect your needs-based government benefits that provide funds for housing, medical care and food.

Keep in mind, if you’re receiving Medicaid, a payback provision to reimburse the money paid for your care will be required, at the time of your death. This may prevent secondary beneficiaries from receiving the remaining balance of SNT funds, as state programs will recapture the cost of Medicaid benefits paid.

Third-party trust

Caregivers and family members, this is an SNT you can set up for your loved one. Place money from parents, grandparents, or any other source into the trust for future use. Even if you don’t have money to put into it immediately, set up your third-party SNT now, refer to it in your will and beneficiary designations, and it will be funded upon your death.

With the SNT protecting your loved one’s government benefits, the money it contains can be spent on supplemental eligible expenses, such as hobbies, travel and quality of life. And, because it’s a third-party special needs trust, Medicaid cannot recapture assets from it.

Pooled trust

As an alternative to setting up your own trust, you can join with other people in special needs situations and have a shared trust. Pooled trusts can be either first or third party, so ask your advisor or a local nonprofit organization that may sponsor a pooled trust.

ABLE account

While it’s not actually a type of trust, an ABLE account is an additional option for accumulating assets. It’s a qualified savings account that receives preferred federal tax treatment. An ABLE account allows you to save for disability-related expenses like assistive technology, employment training, legal fees, living expenses and more. ABLE accounts may also be subject to Medicaid payback depending on your state.

To find out which ABLE accounts are best for you, contact a Voya financial advisor or log on to the ABLE National Resource Center at ablenrc.org.

Action steps:

  • Choose which type of SNT, if any, is the best choice for you.
  • Consider an ABLE account.
  • Find a special needs attorney.
  • Update your beneficiary designations to the SNT, where necessary.
  • Talk to a financial advisor to get started.

Learn more:

Compliance Code
CN1376647_1022
Business Owner
Mathew Stagner
Expiration Date
Baby and mom playing in swimming pool
Employers Financial Professionals Individuals Special needs planning essentials Special needs planning essentials For use with your clients For use with your employees

Neither Voya Financial® or its affiliated companies or representatives offer legal or tax advice. Please seek the advice of a tax attorney or tax advisor prior to making a tax-related insurance/investment decision.  

Products and services offered through the Voya ® family of companies.

Short Title
Types of special needs trusts (SNTs)

Special needs planning and divorce

Member for

1 year 10 months
Submitted by smoses on Fri, 08/28/2020 - 14:39

Under the best circumstances, creating a financial plan involving a child with a disability or special needs can be challenging. When parents decide to divorce, it adds another dimension to the plan; however, with proper planning, the parents — along with trusted advisors — can create a plan that appropriately addresses the needs of the child now and in the future.

Ideally, the divorce will be collaborative with all parties working toward an agreement that is fair and addresses everyone’s concerns. Even in circumstances when the divorcing parents agree on items such as child support and custodial arrangements, care should be taken to document all of the issues. It is important to consult a team of experts that includes a special needs financial planner, both a special needs attorney and a domestic-relations attorney, as well as other experts who will be able to help plan for the future needs of the child or children.

There are several decisions that are typical in every divorce but need special attention when concerning a child who may not live independently in the future. We will discuss the watch-outs and areas that may require special consideration.

Custody and living arrangements

Will the child live primarily with one parent, or will they live equally with both parents? Depending on the child’s circumstances, a typical custodial arrangement may not be suitable. Both parents will need to agree on a visitation schedule that causes the least disruption for the child. For instance, the child may not be able to spend every weekend with the non-custodial parent, either because of environmental reasons, therapy appointments, or simply because they are not able to leave the stability and routine of a primary residence. These factors need to be taken into consideration, and some creativity may be necessary prior to entering into a custody agreement. In fact if both parents can agree, some will decide that the parents switch residences to share time, leaving the child in the custodial home full-time.

Decision makers

Another factor for divorcing parents to consider is who will be the primary decision maker. Will all decisions be shared? Think about medical, educational, religious, and recreational decisions. Will both parents participate in the Individualized Education Plan (IEP) meetings or will one parent take the lead? Once an agreement has been reached, be sure to notify and provide copies to the child’s medical and therapy teams, their school, aids and caretakers to notify all teams of the changed family situation and outlining who will continue to make decisions on behalf of the child. Once the child becomes an adult, a decision around powers of attorney or guardianship will also need to be formalized and shared.

Government benefits eligibility

Due to the cost of care for a child with a disability or special needs, it is important to work with professionals who have a background in special needs financial planning, estate planning and divorce to consider all future expenses and properly fund future needs. Items to consider may include medical equipment, special diets, care expenses, medical insurance co-payments, etc. Government benefits may help offset these costs for those individuals who qualify.

In order for a child to be eligible for needs-based government benefits such as Medicaid, either now or in the future, they must stay below the asset and income threshold. This is especially important in the case of a divorce, when the child may receive child support payments. In order to protect the child’s eligibility for government benefits, a first party special needs trust (SNT) may need to be created for the benefit of the child. Once established, the trust can receive the child support payments. The trust enables assets to be set aside without disqualifying the child from receiving government benefits.

An ABLE account also may be a useful savings vehicle that can complement the financial plans for many families. ABLE accounts offer families the ability to contribute and save for any qualified expenses related to a person’s disability on a tax-advantaged basis. Balances in an ABLE account up to $100,000 do not affect a person’s ability to qualify for needs-based government benefits such as Supplemental Security Income (SSI).

Reaching the age of majority

Once a child reaches the age of majority (age 18 or 19, based on the state) he or she is considered a legal adult. If a child will not be able to make decisions on their own as an adult, guardianship or limited guardianship may be the answer. (This legal process should be started prior to the child’s reaching the age of majority.)

Another decision divorcing parents will face is determining which parent will be the primary guardian or whether they will share guardianship jointly. If guardianship is not required, a power of attorney might be necessary to help manage the individual’s affairs. The parent who does not have power of attorney or guardianship may face significant challenges when trying to get information from medical and service providers or making decisions regarding care. A potential alternative for some families could be joint or co-guardianship, if agreement can be reached.

Where possible, multigenerational successor trustees, agents or guardians should be named in order to help ensure the life care plan continues as envisioned after the death of the originally named parties. Naming successor trustees, agents or guardians might be just as important as naming the current decision makers.

Whether or not child support payments will continue after the child reaches the age of 18 should be decided in advance of divorce proceedings, to avoid being addressed in a court setting. Also take into account that future government benefits may be impacted by child support.

A milestone that occurs when the child reaches the age of majority is the ability to apply for government benefits. If child support payments have been structured to be paid to a SNT, and the child’s assets are below the threshold, the child may qualify for SSI and Medicaid benefits, even if they didn’t qualify prior to the age of majority when eligibility is based on the parents’ resources.

If the child is covered under one of the parent’s medical insurance, it is important to have an agreement to continue coverage. A dependent with a disability is typically eligible for the parent’s employer-sponsored medical insurance plan, as long as the parent is employed, but if the parent who carries this coverage retires or leaves employment, an agreement should be in place regarding who will pay the premiums for replacement medical insurance coverage. If medical coverage is obtained through a state health insurance program, these reimbursements may have an impact on premiums paid. Maintenance of this coverage should be written into the divorce and custodial agreements.

Another transition milestone is when the child finishes school. Will the child need caregiving or will they work? Will the work be part-time or full-time? Will the child want to live on their own in a group or residential setting? Do both parents agree on these milestones?

Finances

Financial planning can be one of the most challenging aspects of divorce, and with the added responsibility of a child with a disability, it may seem overwhelming. It is important for all parties to remember that the goal of the plan is to achieve the best outcome for the child with a disability or special needs, as well as for other children and family members.

In addition to divorce and custodial agreements, other legal documents should be addressed. An SNT for the benefit of the child, as well as guardianship of the child are mentioned earlier, and separate individuals can be named to fulfill the responsibilities of these agreements.

Trustees of a trust make decisions regarding investments and use of the funds, ensuring compliance with laws, tax codes, and the trust document itself. Guardians make decisions regarding the care of the individual with a disability or special needs, and financial decisions on anything not covered by a trust. Successor trustees and guardians are designated to take over these responsibilities should one die, become incapacitated or can no longer serve in the role.

If a special needs trust or ABLE account is established, parents should notify anyone who may be considering a gift or bequest to the individual with a disability or special needs. These transfers can be sent directly to the individual’s trust or ABLE account to avoid potential disruption in needs-based government benefits.

Estate planning

When life changes, plans need to be updated. If there is an existing estate plan for a family, there is a good chance that it needs to be significantly revised in the event of a divorce.

Anytime there’s a person with a disability or special needs included, titling and beneficiary designations are even more important because of the potential impact inheritance can have on government benefits eligibility.

Close attention needs to be paid to beneficiary designations, trusts, powers of attorney and wills to ensure that the most current wishes of each family member are captured in their estate documents.

Designations can be made irrevocable in many cases, which can give peace of mind that ex-spouses won’t undo careful planning decisions.

Blended families

Many divorced parents get remarried at some point, often creating additional complexities for dependents with disabilities and special needs. Routines and family dynamics can change anytime step parents and siblings are introduced into a family. Special care and extra communication can help ease the stress, but there are some legal and government benefits considerations that will need to be addressed as well.

Prenuptial agreements are recommended for any new marriages to spell out obligations for care of a child with special needs in case of future divorce. This includes stipulating how resources are to be used and what should happen if one of the spouses were to pass away.

When a deceased parent was receiving Social Security benefits, there are typically benefits available for ex-spouses, minor children, and dependents with disabilities. The prenuptial agreement should dictate which income benefits are to be used for the care of the child, and which are for the benefit of the ex-spouse. Overall, parents of children with disabilities and special needs should talk to an attorney about the rights that spouses have to inheritances in community property states and consider putting a property status agreement into place to ensure their child’s inheritance stays intact.

If a special needs trust hasn’t already been established, many attorneys will recommend that one is established prior to a new marriage. The trust can be a valuable tool to hold assets and income for a child with special needs and keep them separate from marital assets. The trust can have very specific instructions to ensure that needs and wishes are met, even when additional parties are involved in the family.

Finally, many stepparents choose to legally adopt children from their spouse’s previous marriage. In special needs situations, this decision may carry additional ramifications related to benefits eligibility and legal guardianship, so it’s important to work with a well-qualified attorney and explore all of the pros and cons.

Planning for a lifetime of care

A life care plan and letter of intent are important complements to a good financial and legal planning structure. Documenting all of the needs and wishes of the individual and caretakers for future caretakers and decision makers is critical to ensure continuity of care and vision for the future.

Communication is key

Ultimately, making sure that decisions are made with and communicated to all interested family members and professionals is paramount to avoiding disruption, confusion and disputes in the future. Once a plan is in place, save it somewhere safe and make sure to communicate where it is and how it can be accessed to ensure that the needs of children with disabilities and special needs will be well cared for in the future, no matter what.

Subtitle
Making sure the future of your child with special needs remains secure
Compliance Code
CN1376647_1022
Business Owner
Mathew Stagner
Expiration Date
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Financial Professionals Individuals Special needs planning essentials Planning for life’s milestones For use with your clients Special needs planning essentials

This information is provided by Voya Cares for your education only. Neither Voya nor its representatives offer tax or legal advice. Please consult your tax or legal advisor before making a tax-related investment/insurance decision.

Short Title
Special needs planning and divorce

Employers make a difference

Member for

1 year 10 months
Submitted by smoses on Fri, 08/28/2020 - 12:56

One out of every four people in the U.S. (approximately 66 million people) lives with a disability1, while one out of every five workers assists with caregiving.2 Even so, people with disabilities and their caregivers are often overlooked.

Our central mission is to help all Americans retire better — one person, one family, one institution at a time. And providing solutions and services to the special needs community is a natural extension of our goal. In the process of doing so, we’re looking to help organizations make a difference in the lives of millions living with special needs and disabilities, as well as their caregivers.

How can employers help?

We conducted extensive market research to assess the complex realities and needs of caregivers and employees with disabilities to help inform employers on how to best support them. See below for some of our key findings, and download the whitepaper and infographics to learn more.

Employers can offer education and access to information (such as those on Voyacares.com) that can help their employees understand what resources are available to them and how to make the most of their financial plan.

The toolkit below will help employers address the unique needs of the special needs community and become even more valuable to their clients and employees.

  • Small icon of page with PDF emblem on it inside an orange circle.

    Employer overview (Download PDF)

    Planning and care for special needs in the workplace. We’ll guide the way, so employers can support all their employees.

  • Small icon of check mark inside of a dark orange circle.

    Planning checklist

    Confidently checking all of the boxes means individuals with special needs and caregivers can plan for a better future.

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    Beneficiary planning case study (Download PDF)

    Naming loved ones with special needs or disabilities as beneficiaries could have an unintended impact on their eligibility for government benefits.

  • Small icon of government building or capital building inside a purple circle.

    Government benefits guide (Download PDF)

    An easy-to-follow roadmap to government benefits for special needs planning and how to incorporate those benefits into an overall strategy.

  • Small image of dollar inside a green circle.

    ABLE accounts (Download PDF)

    As use of ABLE accounts grows among the disabilities and special needs community, employers should consider how to incorporate them into their benefits programs, in order to attract and retain quality employees.

  • Small icon of a white heart inside a blue circle.

    Wellthy

    Voya Cares® is collaborating with this innovative health care concierge service to provide support and resources to help families care for loved ones with complex, chronic or ongoing care needs (e.g., a parent with dementia, child with autism, or a spouse with Parkinson’s). Voya’s Retirement and Employee Benefits businesses will offer Wellthy’s services to its current and prospective workplace clients, as an added benefit they can provide to their employees.

Voya Cares helps employers create an inclusive work culture and a more efficient workforce through solutions, educational resources and thought leadership. We’ll help you become more valuable to your employees.

Subtitle
Voya Cares provides resources and support for your caregiver employees and those with disabilities or special needs.
Compliance Code
Business Owner
Mathew Stagner
Expiration Date
Two coworkers smiling and high fiving during a meeting
Employers Financial Professionals For use with your employees For use with your clients
  1. Okoro CA, Hollis ND, Cyrus AC, Griffin-Blake S. Prevalence of Disabilities and Health Care Access by Disability Status and Type Among Adults – United States, 2016. MMWR Morb Mortal Wkly Rep 2018;67:882–887. DOI: dx.doi.org/10.15585/mmwr.mm6732a3 (opens new window) (2018).
  2. “Caregiver Resources & Long-Term Care,” U.S. Department of Health & Human Services, 2017, hhs.gov/aging/long-term-care/index.html (opens new window).
Short Title
Employers make a difference
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