If you are considering a trust for your special needs child, you might be wondering when you should set one up. You might be in good health and have a well-paying job, so creating a special needs trust might feel unnecessary to you. The good news is that you have a lot of flexibility in when you can set up your child’s trust.
According to Nerdwallet, there are two different kinds of special needs trusts that you may set up, depending on when you think is the best time to create one.
Stand-alone trust
This is the kind of special needs trust you can create during your lifetime. You might not see the need for a trust at the moment, but setting one up can still be useful if family members and friends want to contribute to your child’s care. You might also want to create a trust if your child desires the independence of living in his or her own home but still requires assistance.
You are free to compose a stand-alone trust whenever you wish. However, if you want to keep supporting your child personally until the end of your life, you may be able to leave a trust in place after you die to help your child. This is where a testamentary trust comes in.
Testamentary trust
A testamentary trust is one you create through your last will and testament. After you die, your estate executor will set up your trust and fund it per your instructions in your will. This method helps ensure that your child will receive support for as long as your trust can make provision for your loved one. You may also feel more comfortable letting your executor handle the creation of the trust than setting it up yourself.
Ultimately, the time for you to set up your trust will depend on your personal priorities for your family. The good news is that the flexibility of special needs trusts gives you latitude to create one when you need it.
