financial planning for a child with special needs

Raising a child is costly — around $14,000 annually. The expenses associated with raising a child climb for children with special needs. While everyone’s children and financial situation differ, managing their finances while raising their child can be difficult for most parents.

Financial Planning for A Child with Special Needs

Thankfully, there are many resources available to you, so you can provide and care for your child. Check out what you need to know when planning your finances for your child with special needs. If you are looking for more personalized care, talk to these experts about a Michigan special needs trust.

Planning Phase

It’s important to become very aware of your own finances and income. Consider your personal monthly costs, assets, and the cost of possible medications, supplies, and therapy for your child. Not only should you consider your current finances, but you should also create a timeline for your family, preparing for possible gaps in money or support.

It’s always best to have a plan in place in case of a loss of income, a passing of a spouse, or issues securing grants. It is better to be over-prepared than be surprised by a sudden lapse in funds. This is why it’s always a good idea to increase your income, whether that’s through a second job, a pay rise, or even looking for passive income opportunities such as investing in metals, or even cryptocurrencies. Those that are looking to increase their income should also be prepared to do their research into the various laws, tax laws, as well as research into opportunities that could make them extra money.

For example, if you’re wanting to start investing for the future, then it could be beneficial to read into reviews such as this article on BitQT Fake that could determine whether you should trust various trading platforms. After all, you should be wanting to ensure that you don’t lose any money from money-making scams, especially if you’re needing to increase your savings and emergency funds. 

Reduce the Risk of Gap

To reduce the risk of a gap in your finances, you should put together an emergency fund, consisting of about three to six months’ expenses, which you contribute to regularly. Your timeline doesn’t have to be perfect, and you will likely make adjustments as time goes on. With a better idea of your family’s timeline going forward, you will feel more at ease with your child’s future.

Early Childhood

In the early stages of your child’s life, many programs and benefits are worth looking into for many different types of support.

Early childhood intervention programs offer families of children with special needs support and resources. Therapies, parental training, and other forms of support are all offered. The cost of ECI services varies by state. But often, they keep costs as low as possible through sliding-scale payments or cost-share systems.

Federal Aid

There are a variety of federal and state benefits available to children with special needs. These are to help address the financial burden on your family.

  • Supplemental Security Income is qualified low-income families to receive monthly payments to care for their special needs children.
  • Medicaid is designed to help cover the cost of medical expenses and equipment.
  • Children’s Health Insurance Program (CHIP) offers comprehensive health insurance coverage for children under 19 if their parents cannot afford health care but don’t qualify for Medicaid.


In addition to these federal aid programs, many grants, scholarships, and funds are available to children with special needs, which you should research further.

Special Needs Trusts

A special needs trust is a fund for disabled individuals that allows caregivers to contribute funds to their children without altering their qualification programs like Medicaid. Because programs like Medicaid can have strict eligibility requirements, these trusts become essential for managing your child’s monetary assets. There are two types of trusts:

  • First-party special needs trusts are funded by the beneficiary’s assets
  • Third-party special needs trusts are funded by a third party, like family members or friends.

Transition Planning

As your child becomes an adult, there will be significant changes in freedoms and responsibilities that your child is given, so it’s best to plan for this time in their lives. Consider asking their school for vocational opportunities, look into funding for children age 18 to 22, and consider filing for guardianship.

At this point, you’ll need to reassess your finances and goals, depending on your child’s own condition and level of independence. Create savings for additional unexpected costs as they mature.

Financial Planning for A Child with Special Needs

You can’t plan every financial aspect of your life, but doing your best to be prepared for the unexpected. For a more in-depth look at this, Bestow created a great guide that helps you create a financial plan for your special needs child.

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