For families who have dependents with special needs, ensuring their long-term financial security and well-being is a top priority. One effective tool for achieving this goal is the establishment of a special needs trust. A special needs trust allows families to provide for their loved ones with disabilities while preserving their eligibility for government benefits and support services. Regardless of the specific circumstances or the resources you have available, a special needs trust can give you peace of mind while meeting the financial needs of your family member. 

If you believe a special needs trust will benefit your loved one, a good first step is to speak with an experienced attorney who has set up numerous trusts for New Jersey residents in similar situations and can guide you through the following steps:

• Determining trust goals and funding — Before creating a special needs trust, families should clarify their objectives for the trust. This includes determining the types of expenses the trust will cover, such as medical care, therapy, education, housing and quality of life enhancements. Families must also decide how the trust will be funded, whether through personal assets, life insurance proceeds or other means. Maintaining the beneficiary’s eligibility for Medicaid and other government programs is another priority.

• Selecting primary and successor trustees — You should take great care to designate a trustee who will manage the trust assets and make distributions on behalf of the beneficiary with special needs. It's important to choose a trustee who is honest, financially responsible and capable of fulfilling their fiduciary duties. Families should also name successor trustees to ensure continuity of trust administration in the event of the primary trustee's incapacity or death.

• Drafting the trust document — With the assistance of their attorney, families draft the terms and provisions of the special needs trust. The document will specify the beneficiary, trustee, trust assets distribution instructions, and any other relevant instructions and is tailored to the unique needs of the beneficiary.

• Funding and administration — Once the trust document is executed, families can transfer assets into the trust. The trustee will be responsible for managing those assets, investing prudently, and making distributions according to the trust terms. Regular communication between the trustee, beneficiary and family members is essential to ensure the trust remains aligned with the beneficiary's evolving needs and circumstances.

Establishing a special needs trust in New Jersey requires careful consideration of legal requirements, family dynamics and the individual needs of the beneficiary. By working with the knowledgeable attorneys at Parsons & Nardelli, you can take a proactive approach to provides for your loved one's financial security and enhances their quality of life for years to come. Please call 888-309-5589 or contact us online to discuss your particular situation and goals. Our office is in Red Bank.