Q&A Series: Protecting Tomorrows with Mary Anne Ehlert

Published 12/09/2016

In this ongoing Q&A series, we feature comments from Forum partner Mary Anne Ehlert, a highly regarded specialist working with families of individuals with disabilities.

For the first time in history, people with disabilities have a greater likelihood of outliving their parents and guardians. This is why it is essential to plan for a loved one’s future. Families need to make sure everything is in place, so when they are no longer able to act as caregivers, their loved one can still live a high-quality life.

Planning begins by asking family members about their hopes, dreams and fears regarding their loved one with special needs. The next crucial step is to review the key planning steps and complex legal and financial issues related to planning. The following questions and answers address some of those issues.


1–Which federal programs provide benefits for families caring for a loved one with special needs?

Social Security, Social Security Disability and Medicare are the three federal programs currently providing such benefits. These programs are entitlement programs in which benefits are typically earned by work credits. It is very important for all involved persons to understand the credits they have earned to obtain needed benefits. There are also situations where benefits are obtained on a spouse’s work record, or in some cases, on the work record of a parent who is retired, disabled or deceased.

Each individual should obtain his or her own record and understand both these personal work records and related benefits. A spouse should know his or her own record and how it may be affected by his or her spouse’s record (or even an ex-spouse’s record, if they were married for at least 10 years). For a minor child or an adult disabled child, a parent’s disability record may provide benefits to the child.

2–Why is it important to be aware of state laws when planning for a loved one with special needs?

Actually, it is important to be aware of both federal and state laws when planning for a loved one with special needs. Many of the services and funding that support the quality of life for a person with a disability are based on income and assets, and these rules can be extremely complex. There are programs that are entitlement based that only require proof of disability, but if an individual with a disability is not entitled to federal programs such as Social Security Disability and Medicare, the state-funded programs such as Supplemental Security Income (known as SSI) and Medicaid have asset limitations. These asset limitations are typically applied differently based upon the age of the person with the disability.

3–What are the benefits of setting up a special-needs trust?

A special-needs trust is a core component of a special-needs plan, but it is important to understand that there are several types of special-needs trusts. To keep it simple, there are two basic types: 1) a third-party, special-needs trust, which is funded by other people, meaning anyone BUT the person with a disability and 2) a first-party trust, which is funded by the assets of the individual with a disability.

Both trusts provide supplemental savings for a person with a disability. “Supplemental” is the important word to consider here. Since there are limitations on the assets that a person with a disability can own, and we also know it takes much more than just those funds to provide a safe and fulfilling life for an individual, it is imperative to provide funds for the benefit of a person with a disability that will not disqualify them from the all-important government benefits. Government benefits should provide basic support while the special-needs trust provides for supplemental expenses.

A third-party trust is typically funded via the will or trust of the parent’s estate. It could also be funded from other family members. Every family should make sure their estate documents include a special-needs trust if there is a family member with a disability. The third-party trust will have remainder beneficiaries designated so that upon the death of the person with the disability, the grantors (parents) will have chosen who will receive the remainder of the special-needs trust. All family members can then refer to the one third-party, special-needs trust when appropriate.

A first-party trust is funded by the assets of the person with the disability. These funds can come from inheritances gone awry, personal-injury settlements, or even investments set up for the person with the disability that should not have been invested in the name of the person with the disability.

With the many rules and appropriate verbiage that must be used for a first-party trust, it is critical to work with the appropriate legal professionals and an advisor who understands the present and future financial needs of a person with a disability.

4–Why should a family work with an advisor and an attorney when planning?

A qualified, compassionate and cohesive team is critical. The creation and implementation of a care plan (via a social worker), the financial model (via a financial advisor) and the legal work (via an attorney) encompass the entire spectrum of necessary services. The design of the care plan by a social worker helps identify the life and health needs while a financial advisor quantifies the care costs and recommends investment and insurance solutions that should be integrated into the financial and investment plan. At the same time, an attorney should be analyzing the size of the estate and any retirement plans as well as care costs to advise on the appropriate allocation of assets into the special-needs trust.

Such a plan will need to be reviewed annually, as the capabilities of the individual with a disability will change over time. The attorney together with the financial advisor should communicate plans to the extended family. The social worker should continue to identify resources as the needs changes. It truly does take a special team to work with the family.


About Mary Anne Ehlert

Forum partner Mary Anne Ehlert is a financial professional and sister to an individual with disabilities. She serves on the boards of several organizations that provide services to children and adults with special needs, including the Board of Directors of the National Disabilities Institute in Washington, D.C., and Special Olympics Illinois. An advocate for special-needs families, Mary Anne has appeared in a variety of publications and travels extensively to speak at local and national conferences on planning. In one of her latest projects, she is working to start a new Tails for Life Training facility, which provides service dogs to children with disabilities, including personally training two pups.

Mary Anne Ehlert is President of Protected Tomorrows, Inc. which provides advocacy and planning services for individuals with disabilities and their family members. Clients of Protected Tomorrows, Inc., may also be clients of Forum Financial Management, LP. The fees earned by Ms. Ehlert in this outside business activity are separate and apart from the fees clients pay to Forum for advisory services. Protected Tomorrows, Inc., is not affiliated with Forum Financial Management, LP.