Case Study Series Three

Vulnerable Benficiaries: Long-term Protection



John and Jessica Jones are typical loving parents. John runs a successful small business that provides a comfortable lifestyle for the family. They have four beautiful children whom they love equally. John and Jessica have concerns about what would happen to all their children if they were to pass away, but of particular concern is what would happen to their two children with special needs, Tom and Alex. 


Tom is 19 years old, has Cerebral Palsy and receives a disability pension. Tom has limited motor skills, speech difficulties, learning disabilities, and other related conditions that require round the clock care from Jessica.  Alex is 14 years old and has Asperger’s Syndrome, a pervasive developmental disorder commonly referred to as a form of “high-functioning” autism.


While there is no cure, Alex’s personal skills have responded well to a combination of support, regular routine and therapeutic intervention. Alex is enjoying high school after a difficult early childhood.  John and Jessica’s other two children Robert (16) and Sarah (9) do not have any obvious special needs. 


How can modern estate planning Wills from RetireLaw help?


John and Jessica are extremely keen to have an appropriate legal mechanism in place to protect and fund the needs of their children after they die.


Robert and Sarah - no obvious special needs


While Robert and Sarah do not have obvious special needs, who knows what the future holds for them. All modern estate planning Wills from RetireLaw have detailed crisis provisions in place should any beneficiaries be unable to cope with life (addiction, naivety, age, mental health issues), and all create testamentary trusts that provide tax advantages to all beneficiaries as well as the protection of inheritances from divorce, bankruptcy and family disputes - see The Convenient Truth.


Tom and Alex - diagnosed special needs 


There are similar but more specialised testamentary trusts which are designed to protect beneficiaries with diagnosed special needs. The first testamentary trust we will examine is a ‘Special Disability Trust’. 


1. Special Disability Trust


Since 20 September 2006, families have been able to establish a Special Disability Trust during the parents’ lifetime or by Will, which attracts social security means test concessions for the beneficiary and eligible contributors. The purpose of the trust is to assist immediate family members and carers who have the financial means to do so, to make private financial provision for the current and future care and accommodation needs of a family member with a severe disability (like Tom) and to receive means test concessions. 


A Special Disability Trust can hold assets worth up to $578, 500 (indexed each July 1) without these assets impacting on the trust beneficiary’s income support payment (such as Disability Support Pension). It is necessary that before a Special Disability Trust can be established, the prospective trust beneficiary be assessed as severely disabled under the legislation for this type of trust.


RetireLaw solicitors Terry Purcell and Dawn Wong are highly adept at drafting Special Disability Trusts for the long term peace of mind of immediate family members and carers who wish to ensure that a family member with a severe disability is adequately provided for and taken care of once they have passed away. In the next issue of this case study we will examine the benefits of an All Needs Protective Trust. 

This short two part case study series delves into how parents of vulnerable or disabled children can help to ensure the welfare and treatment they wish to provide is seen to with the guidance of a sensible and sustainable legal and financial strategy. 



Vulnerable Beneficiaries: Special Disability Trusts

From 'Dying To Get Her Message Across'

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