Physician with special needs child seeking money management advice

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
Posts: 2
Joined: Wed Oct 10, 2018 4:37 pm

Physician with special needs child seeking money management advice

Post by iloveblf »

Money management questions;
I am a W2 salaried 43 yo physician with 1099 side gig income, divorced and have a special needs child (9 yo and will need lifelong care). Total compensation>$300k forecasted this year. Approx $200k W2 income
No student loans. I have a Special Needs Trust created for my child and all my property is owned in the name of the trust. I own investment property but do not have an LLC. I do have Grade A rental property insurance.

My main costs are a caregiver for my son, child support and house maintenance. I live on about $80k/year.

Total Net Worth approx $2.6M
Loan from parents: $158k
Checking account: $10 K
Money Market Acct with Capital One: $94k

Vanguard Taxable Brokerage account: $692K: VFIAX $172.9k, JPST $125k, VCAIX $3.3k,VGSLX $9.6k, VBTLX $71.8k, VTIAX $27.1k, VTSAX $43.1k, VIG $4.5 k, VDE $24.9k, BIV $1.6k, BLV $5.4k, VOO $10.7k, VTI $31.8k, JETS $6.9k, IAU $1.1 k, MCHI $11.9k, IWF $89.5k, IWD $22k, IWM $16.5k, USO $663, CCL $1.5k, RCL $6.1k, V $4.7k

Vanguard SEP IRA: $40k all VTIVX

Vanguard Trad IRA: $13k VTSAX $6.8, VTV $6.2k

Roth IRA Etrade: $80k IJJ $7.1k, IJK $22.3k, SLYV $8.2k, SWPPX $14.4k, VBK $12.7k, VTI $15k

Previous Employer sponsored 401k: $576k (decided to keep it there due to low costs) all in Vanguard Target Fund 2045
Previous Employer defined benefit plan: $250k (guaranteed 4% returns)

Valic 403B $66k (max out every year) Vanguard Target Fund 2050
Valic403B non-matching $13k Vanguard Target Fund 2050

529 for Child: $67k 62.5% stocks/37.5% bond portfolio

Term life insurance, own policy: $1M
Life insurance through employer $300k
Disability self pay $ 2.5K/month
Disability insurance through employer $2.5k/mth
Own home worth approximately $650k (no mortgage)
4 SFR's -section 8, worth approximately $160k combined, although with tough market now maybe less. One house didn't have any rents for 7 months and had to evict tenant. Rents are between $614 and $700 per house.

My questions are;
1) How can improve my investments?
2) How can I find a good tax accountant for a tax needs like mine?
3) Should I sell the SFR's? But then where should I put the money instead?
4) I live in California and my REI are out of state and an LLC would be very expensive so I haven't gotten one. Any advice?
5) Do I need more insurance?
6) Any specific special needs parenting advice?

Posts: 2408
Joined: Mon Jun 11, 2018 3:17 am

Re: Physician with special needs child seeking money management advice

Post by typical.investor »

Will your child be attending college?

Have you looked into a 529 ABLE plan?

Mine likely won’t be spending all the 529 money on qualified expenses, and so I am rolling it into the 529 ABLE which is more flexible in terms of what is a qualified expense.
Posts: 340
Joined: Tue Jul 13, 2010 12:03 pm

Re: Physician with special needs child seeking money management advice

Post by brajalle »

iloveblf wrote: Sat Aug 22, 2020 10:56 pm 6) Any specific special needs parenting advice?
Sorry this isn't money management specific, but since you asked for #6 as well...

Most of my response is by necessity a bit general. At 9 years in, being a Doctor, and with your likely age being in your 40's, you may have a good handle on some or all of this already. I'd be happy to answer any questions or explain the origin of my advice via PM.

Try to locate a group in the area for special needs children. Support, tips, tricks, and potentially references are all very valuable. Online groups too, but do not ever underestimate the value of a local support network - it can be a life saver.

You said you have a trust set up, presumably you already have found a lawyer who is familiar with special needs. If you already have not, you would probably benefit from seeking out some sort of financial specialist (lawyer, accountant, financial planner, etc) who is very familiar with special needs to help plan a strategy out since it may extend well past your lifetime. I imagine a state special needs group may be aware of people who can help in these areas.

The scariest thing for parents with a special needs child long-term I'd guess would probably revolve around 1) finding quality caregivers, 2) paying for them, 3) if a parent is a caregiver (even if there is full-time help), then aging parents having trouble continuing to give care is a real factor, and 4) who is going to assume guardianship after parents are unable to (ie nursing home/dementia/etc) or are deceased.

Often your best option for #4 is a sibling. That being said, it could be a huge lifelong burden - including limiting their career/life/romantic/etc choices. You will also want a backup or two in that situation potentially.

For #1-3 - For most it involves getting on the programs out there to assist with care-giving expenses. Some have multi-decade waiting lists. Others are limited to a certain geographical area (ie it's county administered - you can never move them out of the county). This can interact with #4 up above too (as I said, it can have a huge burden on siblings potentially). Past that, it just has a large lifelong cost in terms of it just taking a significant amount of resources to do heavy lifting in terms of relieving care burdens/improving care.

Do not underestimate the strain this will bring to your own life - lifelong strain. You're 9 years in, so you probably already know this, but aging is rough in general, and care giving will take it's toll faster. I'd try to develop a strategy for self-care if you already haven't. Honestly you may not have that luxury depending upon the specific needs of a child, but you're going to be less able to care for a child if you do not keep in mind your own needs. This may include lifelong counseling - long before you think you need it.

I'd also consider tracking down a child psychologist or behavioral therapist type that specializes in special needs. Probably few and far between. It's really hard when taking care of a special needs child to realize that some strategies you are using now with the child for certain behaviors/etc could have some pretty negative lifelong impacts for the caregiver. Special needs children as they get older can demonstrate rebellious behaviors like anyone else, and since many of them have little control in their lives - they often try to exert control over what they can. This can be...a huge problem - think soiling themselves multiple times a day on purpose to express anger or get their way. This may have started at how you handle/react as caregivers to simple accidents much earlier combined with a special needs child getting older and wanting to have more control over a life that they may not have much control over. I've also heard of vomiting (& spitting) in similar use. It can be worse than that even. Special needs children can end up running households (not just via caregiving burdens, but via controlling the household with their learned behavior) - this can bleed over into caregivers in terms of marital problems, and in some cases, domestic violence, suicide, etc. Some controlling and learned behaviors are not going to be preventable, but if any advice and coaching you get can have a positive lifelong impact in these sort of areas in terms of trying to avoid the worst outcomes - it would be worth it's weight in gold after spending 20-40-60 years dealing with some behaviors.

Lastly - and as a physician you are probably uniquely situated with a few of these - but special needs parents really have a lifelong duty in terms of research, advocacy, and evaluation of - and on behalf of - their special needs child. Research can be very useful in terms of problem solving, care, etc. Advocacy is essential. Evaluation - not only in observation of your special needs child for providing better care, but also in terms of being realistic about their capabilities. I am aware of parents who don't like to think of their special needs child's full restrictions - or have trouble thinking of them objectively. This can have a negative impact when health providers don't have the full information or when seeking assistance from various programs. Can your child bathe themselves without assistance? They may answer yes - but it turns out they have to be monitored, can't dry themselves, etc. Can your child walk on their own? Yes - but it turns out only for short periods and they often are in a stroller. Etc. This sort of scoring can have a huge lifelong impact by determining program benefits/eligibility in some cases. Also - don't give up on exploring the medical side either if there are medical issues. It's easy to get overwhelmed if there are millions of doctor visits, but sometimes knowing if something is - crohns disease or EDS or such can change small aspects of care that improve situations even if you can't cure it or take medicine for it.

Best wishes.
Posts: 1163
Joined: Thu Apr 23, 2020 12:44 pm

Re: Physician with special needs child seeking money management advice

Post by tashnewbie »

I have no specialized knowledge about any of the specific issues you asked, so take my comments with the skepticism that they deserve.

Two things popped out to me:

1. Will your child likely attend college or have eligible 529 expenses? If not, then it’s worth considering other options like the 529 ABLE that another user mentioned.

2. With a high-stress career and the demands of caring for a special needs child, I personally wouldn’t want to deal with the hassle and headache of taking care of 4 Section 8 rentals. What’s the net ROI? Are the properties profitable? I’d endeavor to streamline my portfolio and probably would get out of rental real estate altogether.

Good luck!
Last edited by tashnewbie on Sun Aug 23, 2020 3:07 pm, edited 1 time in total.
User avatar
Posts: 1736
Joined: Tue Jan 01, 2008 10:47 pm
Location: Midwest

Re: Physician with special needs child seeking money management advice

Post by ram »

Increase life insurance to 2 M.
Sell the rented real estate and put it in 3 fund portfolio.
Simplify your investments to 4 funds. The usual 3 funds and the one you have that pays a guaranteed 4% return (or as close to that as feasible)
Posts: 91
Joined: Tue Jun 28, 2016 9:22 pm

Re: Physician with special needs child seeking money management advice

Post by chrisam314 »

You might benefit from private banking services. That is usually heretical to say on this forum but hear me out.

You are a doctor with a special needs child. It sounds like your full attention needs to be devoted on those things. A good private banking service would find the tax advisor, as well as someone to advise you on the real estate and insurance, and figure out a way for you to simplify the portfolio and banking in one spot in a tax efficient way. They would also help you design a holistic trust (sounds like you have one, maybe a more simplified trust is better wording) in case something happens to you. Just make it clear you have no desire to invest in anything other than low cost index funds and need to see exactly what you are paying for.

Low hanging fruit if you don't want to go that route: Consolidate the non employers sponsored accounts at vanguard. If you want diversification just use VSGMX or VTIVX if you prefer glidepath across all of the retirement accounts and call it a day. Get rid of all the tiny holdings in the taxable account and simplify down if its not too much of a tax hit. The real estate sounds like more of a headache than its worth. Can you payback the loan from the parents quickly? I would hate to have that hanging over my head.
Posts: 275
Joined: Thu Aug 06, 2020 8:46 am

Re: Physician with special needs child seeking money management advice

Post by humblecoder »

iloveblf wrote: Sat Aug 22, 2020 10:56 pm My questions are;
1) How can improve my investments?
2) How can I find a good tax accountant for a tax needs like mine?
3) Should I sell the SFR's? But then where should I put the money instead?
4) I live in California and my REI are out of state and an LLC would be very expensive so I haven't gotten one. Any advice?
5) Do I need more insurance?
6) Any specific special needs parenting advice?

I know this is an old thread, but I am compelled to post in case I can offer some perspective to the OP and anyone else who has a special needs child. I have no professional expertise in this area (not a lawyer, accountant, CFP, etc), but I do have a 14 yo special needs daughter who will need care and support for the remainder of her life. So that is my expertise :-)

First, I'll start by saying that I am in awe of the OP. Being a single parent to a special needs child and all that entails, plus holding down a full time job, plus managing real estate investments. Seriously, I could never do that. I am fortunate that I have my wife and mother-in-law who tag team with me, and even then it feels like a full time job. So kudos to you. Truly.

Second, while this website is an amazing resource - truly a master class when it comes to investing and personal finance, planning for a special needs child is a sub area that most of the people on here haven't had to deal with. Furthermore, each person's situation is different, so what makes sense to me may not make sense for you. Therefore, you need to do your own research or consult with experts who can tailor advice to your situation. This is one area where the normal DIY BH philosophy does NOT make sense. A post on a message board can, at best, help to orient you on the types of questions to ask the experts, but if you rely on advice on here solely, then buyer beware. Related to that, many of the normal BH mantras may not apply to planning for a special needs child, so double check any general advice you get.

So into some specific items that I have come across.

It is good that you have set up a special needs trust for your child. This will make sure that your child's government benefits are protected. Be sure that your will, the wills of any relatives, beneficiaries designations, etc leave any money to the trust and not to your child directly. Also, it is good the you have a 529 account. As others have mentioned, you may want to convert it to an ABLE account. However, if the account goes over $100K, it could impact SSI eligibility, so you will want to keep it under that threshold.

Speaking of SSI, when your child turns 18, he/she will be eligible for SSI and Medicaid so make sure that your child's assets are minimized. Also, study the rules for food and shelter. If your child gets any in-kind support for food and shelter, the SSI benefit gets reduced. You need to make sure that your child is paying his/her equal share of the monthly bill for food and shelter if you want to get the full benefit. has a lot of good information about this. It isn't light reading, but it is well worth familiarizing yourself with it.

You also need to consider, down the road, if you will need to establish guardianship when your child turns 18. Each state does this differently, but it is something to look into BEFORE your child turns 18.

When you claim Social Security, your child would be eligible for SSDI. This could be more than SSI and it also doesn't have the asset restrictions. In addition, this may also qualify your child for Medicare in addition to Medicaid. This may impact your decision on when you take Social Security. The general BH rule of thumb is to delay SS until 70, but the additional benefit of SSDI and Medicare for your child may change the calculus. The opensocialsecurity web site does allow you to take into account child SSDI benefits, but I don't think it considers the Medicare benefit.

As far as general financial planning goes, you will need to save up enough money not just to last your lifetime but the lifetime of your child as well. So instead of needing money for 30 years, you might need it for 70 years. When you settle on your "retirement number", you need to take that into account. Insurance also takes on extra importance since if you are short of your retirement number when you die, insurance will need to cover the rest.

Speaking of insurance, you asked if you have enough insurance. I have no clue. It depends on how much your child will need above and beyond when you have already saved. I don't know his/her level of care or how much that care costs. As I mentioned before, YOU need to do your own homework with your team of experts on how much it will take.

Finally, you asked if your investments can be improved. Honestly, you spit out a lot of ticker symbols and I have no clue what they all mean :-). However, the fact that you have a lot of investments tells me that they can be simplified. This could be an area where you need some professional help to manage your investments. Now I know all of the BH people are going to ban me from this board for saying this, but F- them. You and I know the challenges of raising a special needs child; typical BH's don't. That is your primary job and it is a full time job in of itself. You don't want to take on another full time job managing your investments too. I would talk to a fee-based financial advisor who can put together a plan to manage your investments. I would recommend a Ron Popeil "set-it-and-forget-it" portfolio: target date funds, asset allocation funds, etc. Then you will be good to go. Yes, maybe you could squeeze a few basis points with a typical three or four fund portfolio, but is the extra hassle worth the time? Your time is much more valuable advocating for your child, holding down your job.

I know I vomited a lot of information out there. Again, this isn't gospel. Look at it and take what you want, figure out what makes sense to you, and discard the rest. And best of luck to you on your journey!
Post Reply