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What will happen to my son when I am no longer here? As the mother of a child with special needs, it’s the question I don’t really dare answer, even to myself.
Despite being in my 50s, and my son now in his early teens, my brain has a kind of trip switch which shuts it down whenever it strays too close to the subject. As a result, when it comes to financial planning that will impact his whole future without us – his parents – we’ve done the worst thing possible: Not much at all.
The implications of that inaction are stark. Talking in general terms, rather than intentionally adding to my guilt, Rhiannon Gogh, a chartered financial planner and parent of a child with complex autism, says: “If parents, carers and grandparents don’t do anything at all, it can cause real financial harm to a young person, making someone who is vulnerable even more vulnerable.”
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It’s cold comfort that I am not alone in my inaction. Around two-thirds [66%] of parents of children with a disability have no trust or trustee in place, according to a 2020 survey by Gardner Leader solicitors, a number that is likely to have increased since then experts believe.
Trusts are the biggest piece in the future-planning puzzle.
I could reassure myself that at least I have a will, but that doesn’t actually make things any better. In fact, its standard wording, where my son and his elder sister will inherit equally when my husband and I are no longer alive, would probably disadvantage him, by exposing him to the risks I’ll outline below. Having no will or the wrong kind of will (one that doesn’t use an appropriate trust) are the main reasons that families end up in difficulties.
This realisation is part of what Gogh calls the ‘three hard truths’ of SEND financial planning, which are at the core of her book, Planning with Love: A Guide to Wills and Trusts for Parents of Children with Special Needs. These ‘truths’ perfectly demonstrate why it’s essential for families to plan ahead for vulnerable children.
The first thing to consider is access. Many people are shocked to discover that if someone does not have the mental capacity to receive an inheritance, they won’t be given it – regardless of what is stated in a will.
This may sound outrageous, but it’s about protecting the child. It would be irresponsible for someone without mental capacity to be left in control of their own finances without someone to help them.
So the money typically sits with the executors or trustees until a deputyship order is in place.
A deputy is someone appointed by the courts in England and Wales to make decisions on behalf of the person who lacks capacity. In Scotland, this role is called a guardian and in Northern Ireland it’s called a controller.
Risk doesn’t disappear even when someone has the capacity to manage their own money. Whether a person can receive funds themselves or not, doing so outright can increase their vulnerability.
“Giving a vulnerable person a large sum of money can be like putting a target on them,” says Gogh. She has heard troubling stories where bereaved offspring have given away most of their inheritance to a ‘friend’ who promised to take care of them – only to disappear, along with the money.
The third of the hard truths relates to the financial support they are entitled to and that they need. Put simply, leaving an inheritance directly to a young person with special needs could lead to the loss of their means tested care, support or benefits.
While disability living allowance and personal independence payments are not means tested, universal credit and housing benefits are. Just a small inheritance can render someone ineligible for certain benefits.
With only 5% of people with a learning disability in paid work, the implications of being left without financial support are huge.
“It can be heartbreaking,” says Gogh. “Often, these three challenges occur at once, like a house of cards falling down. Just one can cause irreparable harm. What could be more catastrophic for someone with additional needs than to lose their carer, and face the loss of their funded care and benefits as a result, and perhaps have to be uprooted from where they live and the people they know?”
With the implications for inaction so serious, why wouldn’t you put in place plans as soon as possible? As well as my fear-fuelled tendency to ‘freeze’, there are other issues at play.
Overwhelm is one of them. Future financial planning is one of dozens of administrative tasks that falls heavily on already-stretched SEND parents and carers. Add in the emotional load of parenting a child and it’s easy to see why planning gets slipped.
Other, more obviously urgent issues are usually the priority for parents and carers. Like keeping abreast of changing government rules and provision. Or the trial of annual reviews and battles to secure the right provision via Education Health Care Plans (EHCPs).
Caring for a child with additional needs is, as many people have said, almost a full-time job in itself. And that’s before you start planning for something that, you hope, will be a long time in the future.
The ripples of financial planning for a child’s future extends to grandparents and other relatives. If you’re a grandparent, you may want to leave some money to a vulnerable grandchild in your will, but this can have the same unintended consequences as if they inherited from a parent.
Whether you’re the parent or grandparent, it can be emotional to talk about planning for the future with other family members. They may have different points of view, and it’s not always easy to talk about a future when a child’s loved ones aren’t around.But having an awkward conversation now can avoid potential catastrophe in future.
The best way for grandparents to provide for a young person with additional needs is to discuss their will with a TEP (Trust and Estate Practitioner) solicitor.
Grandparents or relatives can:
Further complexities can arise where a couple are divorced.One parent may put all the correct protections in place for their child, but if the child inherits a large sum of money from the other parent, the same concerns about vulnerability and impact on benefits arise.
Gogh is clear: “Both parents who want to leave money to that young person need to have a will in place with the appropriate protections of a trust, trustees and guardians.”
These are some of the very serious implications that can arise from not planning for your child’s future without you. If you don’t do anything, the usual chain of events that kick in after someone dies can cause real financial harm.
Rhiannon says: “If a child or adult inherits without the right protections in place, it causes an absolute nightmare and it’s not the kind of financial nightmare you can unpick.”
Coming up soon: The practical steps you need to take to protect your child’s future.
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