Case Study Series Three

Vulnerable Benficiaries: Long-term Protection

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. 

 

 

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 second testamentary trust we will examine is a ‘All Needs Protective Trust’. 

 

2. All Needs Protective Trust 

 

Both Tom and Alex would also benefit from the establishment of an All Needs Protective Trust. For Tom, the establishment of an All Needs Protective Trust would give the executor(s) of his parent’s Wills (potentially his siblings in the long term) greater flexibility to best manage Tom’s inheritance and his welfare. 

 

Provision can be made in John and Jessica’s Wills to enable decisions to be made following their passing as to the allocation of capital funds between his Special Disability Trust and his All Needs Protective Trust to best provide for all aspects of Tom’s welfare and needs i.e. for any additional support services, transport solutions, special personal wants or interests - not just his care and housing which is all a Special Disability Trust receiving tax concessions can provide for. 

 

Hopefully Alex’s condition will not necessitate an All Needs Protective Trust by the time he is old enough to inherit. However, the purpose of all good modern estate planning Wills is to anticipate and plan for problems in advance. Therefore it would be a prudent step for his parents to provide the option for All Needs Protective Trust just in case his condition or circumstances deteriorate leaving him unable, or not in a sound position to manage his own inheritance. If a particular vulnerability ceases to exist or be of concern, the trustee can always pass control of the inheritance back to the beneficiary.

CASE STUDY 3.2

 

Vulnerable Beneficiaries: All Needs Protective Trusts

From 'Dying To Get Her Message Across'

Contact RetireLaw Today

 

There is no cost to find out exactly what tailored legal strategy your estate plan needs to meet your wishes, circumstances and objectives. 

 

Phone     02 8908 9700
Email      dwong@retirelaw.com.au

Email      tpurcell@retirelaw.com.au

 

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