How to Secure the Financial Future of an Intellectually Disabled Child

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It’s never easy to think about the future of your child. It’s even harder when they have a disability. But you can ease your mind by taking some time now to plan, and that starts with understanding the options available to you as a parent. 

As per the NIH, 2% to 3% of children in the U.S. have some form of intellectual disability. If your child has intellectual disabilities, you may want to create an ABLE account or set up a special needs trust. And if they’re on track to become independent someday and able-bodied in the meantime, you’ll want to consider applying for certain benefits such as Social Security Disability Insurance (SSDI). 

If this all sounds overwhelming, don’t worry. We’ll explain how each of these options works below and give you some tips for managing them once they’re set up (or not).

Speak With a Financial Professional

If you are a family member or caregiver of an intellectually disabled person, they have somebody to care for their special needs, which is not what usually happens to disabled adults with no family.

To secure the future of a child with a disability, the most important step is to have their finances planned out. For that, the first step would be to speak with a financial professional. A qualified financial advisor can help you understand the options available and help you weigh their pros and cons.

Because this is an important decision, it’s also a good idea to get input from your child’s other caregivers, his or her teacher, for example, and other professionals who have been involved in his or her life, such as therapists, doctors, and lawyers.

You must understand how each option will affect your child’s future finances before choosing one route over another. A professional should be able to explain how each choice could affect the benefits available to him or her. Maximize those benefits while minimizing costs if possible. And guide how to make decisions about property division between parents if divorced at some point in the future.

Create an ABLE Account 

As per ABLE America 2021, some 112,100 ABLE accounts have opened in the country, with its combined worth being $1 billion.

One of the biggest differences between ABLE accounts and 529 college savings plans is that you can open an ABLE account before your child becomes disabled. The need for an ABLE account may be clear soon after birth, or it might not become evident until much later in life. But either way, you have time to plan by opening one now.

ABLE accounts are also exempt from many of the taxes associated with regular savings accounts, which makes them easier for parents who want their children, and their retirement funds, to flourish. 

Because they’re considered supplemental programs and not primary ones like health insurance, they don’t require much paperwork. All you need to do is fill out some basic paperwork at an office near your house and make sure all necessary documentation has been provided before opening up this special account that will help keep your loved ones safe throughout their lives.

Consider Using a Trust for Your Child

A trust is an arrangement in which you transfer your assets to a trustee to manage. In general, there are two types of trusts: testamentary (also called “testamentary trusts”) and nontestamentary. 

A testamentary trust is created by the terms of a will and becomes effective upon your death. It makes no provision for any beneficiaries during your lifetime. A nontestamentary trust, on the other hand, comes into existence during your lifetime and continues after it ends. It has its own set of rules governing how it’s managed, funded, or modified at any time during its existence.

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Declare Your Child Dependent on Your Taxes

Claiming your child as a dependent on your taxes can save you money. If you claim your child as a dependent, you can get a tax credit of up to $1,000 per child.

It’s important to note that to claim someone as your dependent, they cannot make more than $4,000 ($8,000 if married and filing jointly) and must live with you for more than half the year.

Take Advantage of Savings Accounts

When saving money, a savings account is one of the easiest ways to start. You can open an account with your bank or credit union, or use a separate company that specializes in helping people save for retirement.

When you have your checking account through your employer, often referred to as an “employee benefit,” there’s usually an option for setting up automatic deposits into another account of yours, like a savings or retirement fund. If you don’t have access to such an option from your employer, consider opening an IRA (individual retirement account) instead. You can open this type of account at any bank or credit union.

As per Statista, the total value of IRAs in the U.S. was estimated to be $11.8 trillion in 2021.


We know that this is a lot to think about. But it’s worth it. You won’t just be helping your child, but also yourself. If something happens to you, the peace of mind that comes from knowing they are financially secure will help you get through the difficult time. Because, at the end of the day, your family comes first.