In a previous post, our Associate Editor Veronique Hoebeke wrote about the Benefits of Practicing Financial Wellness for people with mental health conditions. Veronique’s post describes how people with mental health issues can improve their overall wellbeing by following basic practices of financial wellness, such as setting financial goals, budgeting and saving money. But for some people, serious lifelong mental illness can make it difficult or impossible for them to follow these practices.
Parents and other family members may have serious concerns about the financial well-being of a loved one with a serious mental health disability:
- How will my loved one with mental illness support herself if she cannot work?
- Who will help her manage her personal finances after I am gone?
- What will happen to my son’s government disability benefits if I leave him money in my will?
- What if he is unable to make good decisions about his care and treatment?
Families with these concerns may wish to consult a disability, family trust and estate lawyer about their options. Lawyers in this specialty may be able to help in some or all of the following ways:
- Apply for or appeal an adverse decision on Social Security disability benefits. For someone facing the prospect of lifetime disability, Social Security benefits can provide a guaranteed income and access to free or low cost health care. Many claims based on mental health disability are initially rejected, later to be approved in an appeals process that can take months or even years to complete. A specialized Social Security or disability lawyer can be very helpful during the appeals process. Attorneys in this area of law frequently work on contingency, charging clients a percentage of the initial claim amount only if they win the case.
- Preserve benefits once awarded. Once government benefits have been secured, you won’t want to put them at risk by leaving your son or daughter an inheritance or spending money on services or goods that could disqualify them. A lawyer in this specialty can advise you on the things you should and shouldn’t do to ensure an uninterrupted flow of disability income and health care coverage.
- Set-up a special needs trust. One way families can provide for the financial wellbeing of a loved one with a disability is to establish a special needs trust. This is a legal arrangement that allows a third party, or trustee, to hold financial assets on behalf of a disabled beneficiary. A special needs trust makes it possible for the disabled person to have funds available for supplemental care or support without jeopardizing his or her eligibility for public benefits. The documentation for this type of trust is legally complex, which is why a competent lawyer who specializes in family trust law is recommended. For additional fees, some lawyers may also agree to act as the trustee who is responsible for managing assets, filing taxes for the trust, and disbursing funds, although many families appoint another family member, such as a sibling, to this role.
- Apply for guardianship or conservatorship. In some instances, mental illness may interfere with a person’s decision-making capacity to the extent that he is unable to care for himself or is vulnerable to victimization by others. In such cases, a family member may apply for guardianship (or conservatorship in some states). Inability to give informed consent that a person understands the risks, benefits and alternatives to various treatment options, can also be grounds for guardianship. The laws concerning guardianship and conservatorship vary greatly from state to state, so it is advisable to find an attorney who specializes in probate litigation in the state where the person lives.
- Prepare for a loved one’s transition to adulthood. Once a child reaches the legal age of consent, parents no longer have an automatic right to access the young person’s private health, legal and financial information. This can be frustrating for family caregivers and can even impair their ability to support and care for their loved one. Lawyers in this specialty can help families prepare for a son’s or daughter’s transition to adulthood, understand their rights as caregivers, and explore other options, such as guardianship and financial planning.
Disability, family trust and estate law is a very large field of practice. A lawyer who specializes in Social Security appeals may not be an expert on special needs trusts. Families with multiple legal needs might be better served by seeking out a firm that specializes in family trust and estate law, and using different lawyers within the firm for different tasks.
Some families may feel that they don’t have enough financial assets to warrant the hiring of a family trust lawyer. Attorney Patick Poeschl of the Connecticut law firm, Nemchek & Poeschl recommends that families interested in setting up a special needs trust with a private firm should be be prepared to fund the trust with, for example, life insurance or with a portion of a parent’s estate. “There is no minimum amount to privately fund a trust for the benefit of a disabled individual but the amount should be sufficient to carry that beneficiary for a sufficient amount of time.” The non-profit organization, PLAN of Connecticut, Inc., will help families set up and administer special needs trusts of any size although the service may not be personalized as what one would get from a specialty firm. It is important to note that in Social Security cases, family assets are not a consideration as attorneys that handle these types of matters will take them on contingency.
Find out more about the reasons to consult a disability, family trust and estate lawyer. On Thursday October 15, Attorney Patrick Poeschl of the law firm Nemchek & Poeschl will speak on the topic of “Disability Estate Planning and Conservatorship.” This informative talk is offered as part of Laurel House’s free Family Seminar Series.
Attorney Patrick L. Poeschl
“Disability Estate Planning and Conservatorship.”
October 15, 6:30 PM (doors open at 6)
Laurel House
1616 Washington Blvd., Stamford, CT
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Wonderfully informative and excellent article – very important and valuable for families.