When you’re a parent of a child with special needs, thinking about the future isn’t optional; it’s necessary. From healthcare and housing to therapies and everyday support, ensuring your child is cared for long after you’re gone takes planning. One of the most effective tools for doing that is special needs trust planning.
A special needs trust (SNT) can protect your child’s access to critical government benefits like SSI and Medi-Cal while providing additional financial support. Without one, even a modest inheritance could disqualify your child from receiving these services. But done correctly, a trust gives your child a better quality of life and greater stability, without compromising eligibility.
Think of a special needs trust as a financial container. Instead of giving money directly to your child (which could be counted against them in SSI or Medicaid eligibility), you place assets into a trust. A trustee (someone you choose) manages the money and uses it for your child’s benefit.
What makes this setup powerful is its design. The funds can be used for things government programs don’t cover, like therapy not covered by insurance, educational support, transportation, or recreation. Meanwhile, SSI continues to provide income for basic needs like food and housing, and Medi-Cal handles medical care.
The key is that the trust supplements those government programs, rather than replacing them.
There are different types of special needs trusts, and which one you need depends on where the money is coming from and what your goals are:
For most families planning ahead, a third-party trust often makes the most sense, especially when built into an existing estate plan through a will or revocable living trust. In these cases, it’s often a testamentary special needs trust, meaning it doesn’t come into existence until the parent or grandparent passes away.
Special needs trust planning isn’t something you want to do halfway. There are a few key steps and decisions that make the difference between a trust that works and one that creates problems.
A trust handles money, but what about the other aspects of your child’s life?
When your child turns 18, they’re legally an adult, even if they aren’t ready to make decisions on their own. That’s where guardianship or conservatorship comes in. You can plan for this in advance by nominating someone you trust to step into that role.
You should also document your child’s preferences, routines, and needs, as these things aren’t always spelled out in legal forms. This could be a letter of intent or a personal guide to help the future caregiver or trustee understand who your child is and what kind of life you hope they’ll have.
In California, there are a few extra layers to keep in mind:
Life changes, and so do laws. What works now might not work five years from now. That’s why it’s important to revisit your plan regularly, ideally once a year or whenever there’s a major life change like a new diagnosis, change in benefits, or family shift.
Planning for a child with special needs isn’t something you want to leave to guesswork. A DIY approach or generic legal form won’t account for the long-term care, benefits eligibility, and protections your child may need. Without a properly structured special needs trust, even well-intentioned plans can fall short.
At Ferguson Law Group, we help families create trusts that support their loved ones now and in the future—without jeopardizing access to public benefits. Whether you need a standalone or testamentary special needs trust, or guidance on how to begin, we’re here to make the process clear and manageable.
Give your child the security and support they deserve. Contact us today to start planning with confidence.
It helps protect your loved one’s eligibility for government benefits while providing them financial support.
You create the trust with an attorney who ensures it meets California and federal rules to protect benefits.
Yes, if the trust is properly structured, the funds won’t count against SSI limits, so benefits can continue.
