Planning for a Lifetime of Care


Planning for a Lifetime of Care


Developing a financial plan for a lifetime of care - for both yourself and the person(s) you’re caring for - can help you and your family better prepare for and navigate predicted and unexpected future situations. A lifetime care plan is valuable for parents caring for a child with a disability or special needs as well as adult children caring for aging parents. It is an important part of retirement planning and one that, if missed, can compound future financial challenges.

What does it mean to plan for a lifetime of care?

Traditional financial planning focuses on accumulating assets and producing income in a traditional retirement situation for an individual. Caregivers are often planning for two or more lifetimes - the caregiver(s) and person(s) receiving care. In the event that someone else is put in charge of an individual’s care, because a primary caregiver is no longer able to provide care or passes away, a plan can outline the details necessary to properly address and support a person’s ongoing care needs.

Planning for a lifetime of care means focusing on coordinating assets, including personal assets and government and employee benefits. These three components can help supplement and preserve the others. For example, Health Savings Accounts (HSA) and Flexible Spending Accounts (FSA) can pay for therapies, equipment, and treatments that government benefits may not, and employer-paid back-up care can free up personal funds that can be put toward retirement. 

This plan may also include spending down and depleting assets to maintain government benefit eligibility. For example, in order to qualify for Supplemental Security Income (SSI) and Medicaid, an individual cannot have more than $2,000 in assets. The plan will explain everything your future care providers need to know.

How do I start the process of planning for a lifetime of care? 

Financial professionals experienced in planning for a lifetime of care often use a checklist to guide their client’s planning efforts. This comprehensive checklist, like this one we developed for special needs care planning, helps bring to the top of caregivers’ minds the activities that need to take place when planning for a lifetime of continuous care -from setting up a family meeting, to identifying all financial resources available from government and employee benefits and insurance and personal assets, and ultimately to identifying future care considerations and how to pay for them.

One important step that the checklist includes is preparing a letter of intent (LOI), which provides a foundation for the plan. It is a guidebook-like reference for future guardians and caregivers and provides a roadmap of you and your loved one’s hopes and dreams for their continuation of care. It is a living document - one that is never complete but is as up-to-date as possible.

An LOI can be prepared using a guide, like the one linked in the previous paragraph, or you can create one on your own. Just make sure it includes the following information:

  • A general overview that explains in detail your loved one’s personality and day-to-day activities along with successful behavior management strategies and programs. 
  • A medical section that lists doctors, therapists, and medications. 
  • An assets section that details government benefits, employee benefits, insurance policies, bank accounts, salary, child support, and other income or assets that the individual may have.
  • An environment section that describes nutrition, living arrangements, recreation, education, and employment.
  • A legal and estate planning section that identifies any financial or estate planning that is already in place.

What financial tools are available to be effective in planning for a lifetime of care?

Two planning tools are available: ABLE accounts and special needs trusts (SNTs).

ABLE Accounts Definition

ABLE accounts are state-established savings accounts with preferred federal tax treatment. They help individuals with disabilities and special needs budget, manage spending, and save for disability-related expenses.

The maximum contribution to ABLE accounts in a tax year is $15,000 in 2021. However, qualifying individuals who are earning income, but do not participate in their employer’s retirement plan, can save up to $12,760 (+ $15,000 annual maximum contribution = $27,760 maximum annual contribution).

The assets in an ABLE account do not affect an individual’s eligibility for public assistance. As previously mentioned, as little as $2,000 could affect eligibility for Supplemental Security Income (SSI) and Medicaid, but assets in an ABLE account do not count against this limit.

Special Needs Trust Definition

SNTs also protect a qualifying individual’s eligibility to receive government benefits. They are often used for estate planning and family wealth transfers, especially when a beneficiary has disability or special needs. There is no limit to the amount and types of assets that can be included in a special needs trust.

What are the differences between an ABLE account and a Special Needs Trust?

  • ABLE accounts: 
    • Are easier to access for short-term spending.
    • Allow broader spending power for things like food and housing.
    • Include tax-free earnings.
    • Enable individuals to manage their own money.
    • May be eligible for state tax deductions.
  • SNTs:
    • Can hold unlimited assets.
    • Are taxable either at the trust level or the individual level, depending on their structure.
    • Can be used for multi-generational planning (if they are a third-party trust rather than a first-party trust).

Planning for a lifetime of care provides opportunities to use both ABLE accounts and SNTs together. For example, SNTs allow distributions to fund an ABLE account.

These tools and resources are available to start the process of planning for a lifetime of care, but they are not a substitute for the guidance that an experienced financial professional and attorney, both of whom are experienced in special needs planning, can provide. One way to locate an experienced professional in your area is to visit Special Needs Answers.

Preparing a sound financial plan that can support a lifetime of care not only helps ensure that you and the person(s) you care for will benefit from uninterrupted care throughout your lives. Once the burden of uncertainty about the future is lifted, it also can provide the financial confidence you need to live your best life in the short-term.

About the Contributor

Jessica Tuman is vice president of the Voya Cares® Center of Excellence at Voya Financial. Voya Cares provides training and resources to help its staff and external stakeholders understand, employ and better serve those with disabilities and special needs and their caregivers to achieve the quality of life they seek today and through retirement. Learn more at

This material is provided for general and educational purposes only; it is not intended to provide tax or investment advice and is not intended to be used to avoid tax penalties. All investments are subject to risk. Neither Voya® nor its affiliated companies or representatives provide tax or legal advice. Please consult a tax adviser or attorney before making a tax-related investment/insurance decision.

Products and services offered through the Voya® family of companies.

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