Future Planning: Should I Enroll in a Special Needs Trust Now or Wait?

Frequently I am asked by parents if they should go ahead and enroll in Trust I – The Arc of Indiana’s special needs trust program – or should they wait, even if they know that they want to use the trust to provide for their child in the future.

If you are preparing or updating your will or life insurance, this would be a good time to complete the Trust I Joinder Agreement (our enrollment form)  and pay, or make arrangements for payments, for the one-time enrollment fee.  We can provide very simple language to include in your will that directs funds to be placed in the trust upon your death. Similarly, we can provide language directing that proceeds from life insurance be directed to the trust.

Although the trust probably will not be funded for many years to come, with your will and life insurance in order, and the trust created to accept those funds, we are prepared to immediately begin making disbursements if something unexpected happens.

One year after enrollment an annual renewal fee will be due.  This fee will be due every year until the trust is funded.  The fee will never go up, but it is necessary to pay this fee in order to keep the account open.  We will also contact you once a year to make sure none of your information has changed, including  information on key people who will be involved with your child when you are no longer there.

So, what happens if parents decide to fund The Arc Trust through a will and/or life insurance but don’t actually enroll in the trust?

We will open a trust, but we will have to gather all the necessary information about your child, his or her benefits, key people who will make requests for disbursements from the trust, and how any money remaining in the account upon your child’s death should be disbursed.  This takes a lot more work on our part.  Because of this we charge a higher enrollment fee at that time.

Some parents elect to pay the higher fee for various reasons.  This may be because they are unsure of their child’s life expectancy, they are concerned about paying the enrollment and/or renewal fees, or they are not aware that they can enroll in The Arc Trust prior to actually funding the trust upon their death.

Our recommendation is to go ahead and get the account set up while both parents are alive.  That way family members who are left to handle your affairs will not have to take care of this for you, and we will have all the information we need to immediately begin providing for your child.  If you need to make payment arrangements for the enrollment or renewal fees, please do not hesitate to contact me, I do not want this to stop you from enrolling in the trust.  We can discuss what would work best for your family.

While you can choose to not enroll in The Arc Trust prior to the account being funded, in most cases we encourage you to enroll once you feel that the trust is the right choice for providing for your loved one in the future.

As always, please don’t hesitate to contact  me or other staff in the The Arc Master Trust office.  We’re here to help in any way we can as you plan for your child’s future.

Melissa Justice is the Trust Director for The Arc of Indiana Master Trust
Contact Melissa at mjustice@arcind.org or 317-977-2375.  Learn more about The Arc Master Trust by visiting www.thearctrust.org

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