EPISODE 14 – Being Able to Trust in Trusts – September 1, 2022
Trust is important before taking any step. Listen to Bart specify risks and benefits of a special needs trust such as potentially losing government assistance, mismanagement of personal assets, as well as what does and can happen with Medicaid or an inheritance. Knowing risks and benefits allows you to trust in trusts, the latest Vista Points podcast episode of Choose Your Path.
EPISODE 14 SCRIPT:
Greetings from our Middle Tennessee studio. Welcome to today’s Vista Points podcast, “Choose Your Path”, where the Vista Points staff are committed to improving the quality of life for people living with a disability.
I’m Bart, your podcast host. My role is to walk with you on this journey to discovering and using special needs trusts. Today, I am glad to address the topic of “Being Able to Trust in Trusts”.
Special needs trusts can feel like a big, mysterious, or unknown topic to some, and I am here to remedy that. After all, Vista Points is your expert resource for special needs trusts, and we hold this podcast to educate you about everything associated with them. I encourage you to listen to any past and future podcast episode. Search for the topics you are interested in at the time. And know we are here for you each step of your way toward and with special needs trust. So now, let’s get down to talking about our topic – “Being Able to Trust in Trusts”.
Is your loved one or you living with a physical, mental or intellectual disability or progressive chronic illness? Without a special needs trust to protect personal assets, more is at risk than what you may realize.
- You risk losing your government assistance and relying on personal assets to provide for basic care and to maintain a comfortable lifestyle.
- You face the prospect of reapplying for benefits only after all personal assets are depleted.
- You also face mismanagement of personal assets when relying on family members or other non-professionals to handle your funds.
It pays to know what you are risking if you choose not to take advantage of protection offered by special needs trusts. So, let’s consider the benefits of a special needs trust.
- For anyone living with a disability or has special needs, Medicaid is very important. This benefit covers a person’s healthcare needs. Medicaid is a joint program funded by the federal and state government. For a person to qualify, there must be a diagnosis of a disability, or the person must have special needs. Children and adults can qualify for Medicaid only if their monthly income and the value of their other assets fall below $2,000. This amount could vary from state-to-state. A special needs trust restricts the beneficiary’s own direct access to personal assets in a special needs trust to such an extent that the assets are not considered legally available to the beneficiary. This allows a special needs trust to protect the beneficiary’s Medicaid eligibility because the assets in the trust are not counted as a personal asset.
- Another benefit for anyone who is living with a limited income and has limited resources, while also living with a disability or special needs, Supplemental Security Income, that’s Supplemental Security Income, that’s hard to say, may be a source of financial benefits. SSI can be used for basic needs such as housing and food – two items not permitted to be paid from a special needs trust. This SSI benefit is need-based. If someone inherits money, the beneficiary can potentially have benefits reduced or lose them altogether. However, by naming a special needs trust, instead of your loved one as the beneficiary, the inheritance can be deposited directly into the trust, for the beneficiary’s use, and not jeopardize SSI coverage. Additionally, in Tennessee, SSI recipients normally qualify automatically for Medicaid benefits.
Federal and state benefits are available to qualified children and adults who are living with a disability or have special needs. If your child qualifies for government benefits, you want to ensure that his or her eligibility continue into the future. By establishing a special needs trust, you can reach this goal. A special needs trust provides for supplementary items or services the government benefits do not cover.
Once you weigh the risks versus the benefits and realize you want, or need, a special needs trust, it is important to understand there are different types of special needs trusts. For example, in a Pooled special needs trust, the beneficiary receives more than just protection of public benefits. The beneficiary acquires the advantages that come with being a member of a large trust, including high-quality investment management services, better interest rates and professional trustee services.
Although Medicaid pays for many of a beneficiary’s medical expenses such as hospital bills, physician services, usually long-term care, it will not pay for items or services that are deemed “non-essential”. These items and services could be an eye exam and glasses, hearing aids, hearing tests, nonmedical care, clothing, education, and other personal expenses such as transportation, computers, and vacations. This is where a special needs trust can help the beneficiary to live a better quality of life. It also gives the family peace of mind.
What about family members serving as a trustee for the special needs trust? You might be wondering is it possible to manage a special needs trust on your own? On the surface, having a family member serve as trustee may seem like a logical choice because family members are usually in the best position to understand your special needs. Unfortunately, unless the family member’s expert in special needs trusts, he or she may not have the knowledge needed to fulfill the role of trustee and inadvertently jeopardize your eligibility for public assistance programs. Therefore, it is very important to rely on experts to establish, administer and manage your special needs trust.
Think about the likelihood of your child or you living for many more years, with the disability or chronic illness. How will your child or a loved one manage their disability? Will there be sufficient insurance and money to live a good quality of life? Will you have someone you can trust to manage the financial affairs associated with a special needs trust, if you, serving as the trustee, are not able to do this? Would a special needs trust offer your family and you peace of mind, knowing that government benefits will be provided to cover your healthcare needs and possibly more, while preserving assets for other personal items or services?
Gosh, I’ve given you a lot to think about and consider. And, you may even need to listen to this podcast a few times to understand everything I talked about today.
Thank you to our listeners for tuning in to today’s episode of Choose Your Path, a Vista Points podcast. Subscribe now YouTube channel named Vista Points SNT, that’s S-N-T as in special needs trust. There you can subscribe and be notified of the latest episodes go live, which are on the 1st and the 15th of every month.
You can find past episodes on the Vista Points website at vistapoints.org, as well as a transcript of each podcast. The episode topics are in response to listeners’ questions! If you haven’t asked your questions yet, I encourage you to ask or share other concerns online or by calling us. When you’re online, visit the Vista Points page named Vista Points and send a direct message, otherwise known as a D-M, to Vista Points, that’s Vista-Points-I-N-C, VistaPointsInc, if you will.
Or, call the Vista Points office at 888-422-4076. That number is 888-422-4076. Each of the Vista Points team wants to answer your questions and assist you in whatever way they can.
Now, enjoy your day with your loved one. Come back for more or look into past episodes of Choose Your Path. Regardless of where you find us, or when you find us, we walk beside you on your path. I look forward to our next steps together and speaking to you soon.