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John Bair
John Bair
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How Much is Your Special Needs Trust Costing You?

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For parents of kids with special needs, the longevity of the child’s assets for their long-term care is predominantly determined by costs and taxes. A settlement recovered in litigation may at first seem to be a welcome relief, but the choices parents make about that money directly dictate how long it will last. That’s a lot of pressure to handle on your own.

how much does a special needs trust cost

Was your child’s trust set up many years ago? Do you know how much you are being charged every year in costs and taxes?

Parents need to work closely with a professional who has their family’s and child’s best interest in mind. Many families assume going to their local bank or a big national institution is the safest. However, that route is the most expensive. Here is an example of how those trusts are most often administered:

  • Trustee = 1%
  • Investment adviser 1%
  • Expense ratios in funds = 1%.

When we’re talking about a million dollars in assets, those costs equate to $30,000 each year. And a million dollars isn’t an uncommon amount. In fact, the average balance for a special needs trust for a child with cerebral palsy due to birth trauma is $1.7 million. However, a properly designed special needs trust should cost no more than 1.25 percent per year, which is almost a third as much as the norm.

When considering a special needs trust, collecting the right information is critical. Parents must be well-informed from the beginning in order to avoid falling victim to paying a staggering amount of their child’s money to trust costs. It all starts with finding a trustworthy team to explain the ins and outs. That’s what we do. Please feel free to call for a free consultation on how to set up a special needs trust or to evaluate whether your child may need one.

 

 

About John Bair

John Bair has guided thousands of plaintiffs through the settlement process as co-founder of Milestone Consulting, LLC, a broad-based settlement planning and management firm. Milestone’s approach is comprehensive and future-focused. John’s team has guided thousands of clients by taking the time to understand the complexities of each case. They assess the best outcome and find the path that enables each client to manage their many needs. Read more about Milestone Consulting at http://milestoneseventh.com/.

 

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