Common Mistakes When Planning for a Disabled Family Member
Planning for the future of a loved one with special needs requires care, compassion, and the right legal strategy. Unfortunately, many families unintentionally make mistakes that can jeopardize a disabled family member’s eligibility for critical government benefits such as SSI, Medicaid, and Section 8 housing.
With over 58 million Americans living with disabilities, understanding the right way to plan financially and legally is essential to ensuring lifelong protection and support.
1. Disinheriting a Loved One With Special Needs
One of the most common — and most damaging — mistakes families make is disinheriting their loved one with special needs.
Many parents assume that leaving their estate to another child or relative, who will then “look after” the disabled family member, is the safest approach. However, this often leads to major problems:
- The non-disabled sibling could face lawsuits, bankruptcy, or divorce, which could cause the inherited funds to be lost.
- There is no legal obligation requiring the sibling to use the money for their disabled relative’s care.
Instead of disinheriting your loved one, it’s better to establish a Special Needs Trust (SNT), which ensures funds are used exclusively for their benefit while preserving eligibility for public assistance.
2. Failing to Create a Properly Drafted Special Needs Trust
Another frequent error is not setting up a legally compliant Special Needs Trust.
Government programs such as Supplemental Security Income (SSI) and Medicaid have strict asset limits — typically allowing a recipient to have no more than $2,000 in countable assets. If your disabled family member inherits money or owns property that exceeds this limit, they could lose their benefits until their assets are “spent down.”
A properly drafted Special Needs Trust protects these assets while allowing your loved one to continue receiving government aid for essential medical and living expenses.
3. Unintentionally Jeopardizing Benefits Through Gifts
Even well-meaning friends or extended family can cause harm by giving cash or gifts directly to a person with disabilities.
If a disabled individual already receives SSI or Medicaid, accepting money or property could push them over the asset threshold, disqualifying them from benefits. Once disqualified, the reapplication process can be lengthy and stressful.
Before accepting or giving financial gifts, always consult an elder law attorney or special needs planner to ensure the funds are directed safely — typically through a trust or ABLE account.
4. Crowdfunding Without Legal Planning
Online fundraising platforms like GoFundMe are popular ways to help loved ones in need. However, for individuals with disabilities, these donations can unintentionally cause harm.
Without proper legal structuring, crowdfunding proceeds can count as income or assets, resulting in the loss of SSI, Medicaid, food assistance, or housing benefits.
Before launching or accepting any type of fundraiser, families should speak with a special needs planning attorney to ensure contributions are managed through a compliant Special Needs Trust or nonprofit fund.
5. Not Planning Early Enough
Procrastination is another common mistake. Many families wait until a crisis arises before addressing long-term financial and care planning.
Early planning allows families to:
- Protect eligibility for government benefits
- Secure future housing, care, and medical resources
- Designate trustworthy guardians and trustees
- Reduce family stress and confusion later
The best time to plan is now — before unexpected changes occur.
6. Not Getting Professional Legal Guidance
Special needs planning involves complex federal and state regulations, and even small mistakes can have lasting financial consequences.
An experienced elder law or special needs planning attorney can:
- Help you determine which type of Special Needs Trust best fits your situation
- Ensure your plan complies with SSI and Medicaid rules
- Protect your family’s assets for long-term care and quality of life
Plan Ahead With Confidence
Proper planning ensures your loved one with special needs is cared for — emotionally, medically, and financially — long after you’re gone.
At Aging in Maine, we help families navigate the complexities of special needs trusts, estate planning, and public benefits with compassion and clarity.
📞 Contact Aging in Maine (207)848-5600 today to schedule a consultation and create a plan that gives your family peace of mind.
