Settlement options for a special needs minor about to receive personal injury award

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colageezer
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Settlement options for a special needs minor about to receive personal injury award

Post by colageezer » Fri May 03, 2019 6:51 pm

I have a 17 year old niece that is about to receive a $130,000 settlement for dental malpractice. At some point in the next few years she is going to need approximately 30K for implant work that cannot be completed until she matures a little more. Her 82 year old grandmother legally is her guardian, although she is now living with her mother. Her mother has had substance abuse problems in the past for which she has been incarcerated. Although her mom appears stable at this time, she has no history of financial stewardship, and my niece literally can’t even count money. My understanding is that she would have unfettered access to the entire lump sum at age 18. Can anyone offer advice as to possible options, or where to seek unbiased advice for a challenge of this nature?

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cheese_breath
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by cheese_breath » Fri May 03, 2019 7:20 pm

I'd start by seeing the lawyer who got her the settlement.
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fabdog
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by fabdog » Fri May 03, 2019 7:36 pm

I'd agree with seeing the lawyer... ask about Special needs trust... There are specific requirements but he/she should be able to help you determine if this is applicable.

If it is, it offers some flexibility on having assets in the trust and some income without jeopardizing any aid she may be receiving

Mike

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Re: Settlement options for a special needs minor about to receive personal injury award

Post by Grt2bOutdoors » Fri May 03, 2019 7:39 pm

Use of a trust vehicle with stipulation that money be accessible for dental reconstruction and essential needs. You need an attorney for this - ask the settlement attorney. Do not use a simple UTMA account for this, or as you say minor will get all of the money at age of majority in the state.
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ResearchMed
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by ResearchMed » Fri May 03, 2019 8:04 pm

What is age of majority? If 18, how soon is her birthday, and would she agree to not having a nifty lump sum at hand (even with the best of intentions)?

I'm sort of surprised there wasn't something like this set up at settlement time. Is it possible it's already done?

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ForeverMom
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by ForeverMom » Fri May 03, 2019 8:32 pm

If your niece literally cannot count money, was/is there a plan for her mother or grandparent to obtain legal guardianship after (as) your niece reaches 18?

Are you worried your niece wouldn’t know what to do with the money, or that her mother would not be responsible with that amount of money?

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Re: Settlement options for a special needs minor about to receive personal injury award

Post by HIinvestor » Fri May 03, 2019 8:42 pm

I agree that the attorney involved in the case should be able to structure the award so it’s in a special needs trust and will provide lump sums at specified intervals and perhaps an annuity to help support this young person. Good luck!

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cheese_breath
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by cheese_breath » Fri May 03, 2019 8:48 pm

BTW have you talked to the grandmother about this? I would think she'd have more legal standing since she's the guardian, and you're just a concerned relative. Is she physically able to visit the lawyer with you?
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colageezer
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by colageezer » Fri May 03, 2019 9:23 pm

ForeverMom wrote:
Fri May 03, 2019 8:32 pm
If your niece literally cannot count money, was/is there a plan for her mother or grandparent to obtain legal guardianship after (as) your niece reaches 18?

Are you worried your niece wouldn’t know what to do with the money, or that her mother would not be responsible with that amount of money?
I’m worried about both ... and there is no plan for legal guardianship past 18 at this time. Her mother would emphatically deny the need. All of this is just now taking place. I will be traveling home this weekend and hope to learn more from my mom at that time. Perhaps we can speak with the attorney early in the week. I’m really just trying to understand what the correct questions might be. Very tough family dynamics.

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Re: Settlement options for a special needs minor about to receive personal injury award

Post by BarbBrooklyn » Sat May 04, 2019 3:26 am

What is your niece's disability that her mother is able to deny it?

What do her school counselors say about her capacity for schooling, job training, ability to live on her own?

Have the mother's parental rights been terminated?
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colageezer
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by colageezer » Sat May 04, 2019 6:49 am

BarbBrooklyn wrote:
Sat May 04, 2019 3:26 am
What is your niece's disability that her mother is able to deny it?

What do her school counselors say about her capacity for schooling, job training, ability to live on her own?

Have the mother's parental rights been terminated?
It is quite complicated. She just turned 17, attends regular classes at her high school, but fails all of them. She can read and write, but can barely hold any type of a conversation. She can’t count money and won’t tolerate trying to learn at all. Her learning disabilities can be subtle and glaring at the same time. Her mother does not engage and push for extra services with the school and takes the position that she’s “just not good at school.” She had to go to summer school last year and my mother and I had to literally beg, reason and threaten to get her mother to send her. She is in denial as to her daughter’s problems and does not want her in “special needs” classes because of fear of her being stigmatized and picked on. At this point it feels like the school and her mom are both doing the minimum to pass her out of the system. My mother is still somewhat engaged with the school but she is in failing health and mind. I live in another state.
I guess the short answers to your questions are that her grandmother technically still has custody, though she has mostly been living with her mother for the last two years. Her mothers parental rights have not been terminated. My niece does have a formal diagnosis for her learning disabilities. I’m not sure what the school’s position is on her ability to live independently. Everyone with whom my niece engages, professionals included, can recognize her disabilities, but her mom just wants to believe that she is not a special needs child, regardless.
This settlement thing just happened on Thursday. I’m going home to spend mother’s day week with our mother and was just hoping for whatever input or advice I could get before going home. I have all kinds of fears for my niece’s future and the potential pitfalls here. My hope would be to help our disfunctional family find our way through this without blowing it. I know that the way this is handled could have so many more consequences than just the glaring one of handing a kid who can’t count $130K. Just understanding the appropriate questions and whom to ask seems the correct place to start.
Thank you for your reply.

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Re: Settlement options for a special needs minor about to receive personal injury award

Post by BarbBrooklyn » Sat May 04, 2019 6:59 am

Oh boy! Thank you for clarifying.

I think you need to talk to the attorney with your mom. Bring whatever paperwork you have documenting the dx, severity, etc.

Hopefully, the attorney is part of a firm where someone has some expertise in trusts, including special needs and medical trusts. I think what your mom wants to ask for is a trust set up to insure that the money for the dental work is set aside in FDIC insured instruments and not touched. You want to know if there is a way to encumber the rest of the money so that it is not squandered. There also needs to be someone to administer the trust. You?
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by ForeverMom » Sat May 04, 2019 7:11 am

OP,

That does indeed sounds like a very difficult situation. I was thinking last night of the educational aspect, too, in that she would probably need some (a lot) assistance navigating the IEP process if she’s still in school at 18. And potentially, depending on the level and nature of disability, obtaining general medical care and things like that. When the parent is in denial, it can get very complicated.

Hopefully once someone speaks to the lawyer that was involved in the settlement, at least the monetary considerations can be organized in a safe manner for the benefit of your niece.

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Re: Settlement options for a special needs minor about to receive personal injury award

Post by Shallowpockets » Sat May 04, 2019 7:13 am

This is found money from a settlement from bad dental work. She stills needs dental work. At what age would that be all right to start doing? I would think that would be a priority. Bad teeth can have consequences that accelerate. Plus there is a social side to bad teeth, both on self image and how others perceive you. Your niece does not need any of that sort of problem. So to me, the first step is not how to disperse or arrange the money, it would be to get at dental work done. I would prioritize that over looking at the money as some sort of windfall for life.

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ResearchMed
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by ResearchMed » Sat May 04, 2019 7:23 am

Shallowpockets wrote:
Sat May 04, 2019 7:13 am
This is found money from a settlement from bad dental work. She stills needs dental work. At what age would that be all right to start doing? I would think that would be a priority. Bad teeth can have consequences that accelerate. Plus there is a social side to bad teeth, both on self image and how others perceive you. Your niece does not need any of that sort of problem. So to me, the first step is not how to disperse or arrange the money, it would be to get at dental work done. I would prioritize that over looking at the money as some sort of windfall for life.
We don't know at what age the dental work can be done, but OP estimates it will cost ~$30k. Even doubling that estimate leaves a large sum of money to leave to someone who pretty obviously doesn't have the skills to manage it well. And then there is the possibility of another family member "helping" to "manage" it (poorly).

So there *is* a windfall, in two parts. One part is "spoken for", but still needs to be kept safe.
The other part needs to be kept safe for what is likely a longer time period. But it's not enough to support her for life or anything, so perhaps some sort of Special Needs trust would be wise to consider. That way, it wouldn't disqualify her for other support.

Separate from all of this, I assume that someone is considering where/how she will live in the future?

This is a heavy responsibility for you, and it doesn't seem that it will be ending soon.
Do you want to continue this for what might be decades? Just think about that, and what choices there are, for her and for you, etc.

Good luck. She is fortunate to have your help at this point!

RM
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Winston19
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by Winston19 » Sat May 04, 2019 7:51 am

Did they do a structured settlement? If not, it might still be an option. Another similar option is an immediate annuity.

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colageezer
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by colageezer » Sat May 04, 2019 7:57 am

Winston19 wrote:
Sat May 04, 2019 7:51 am
Did they do a structured settlement? If not, it might still be an option. Another similar option is an immediate annuity.
I won’t really know until next week. All I know now is that the case was settled and that her portion will be 130k.

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colageezer
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by colageezer » Sat May 04, 2019 8:03 am

Shallowpockets wrote:
Sat May 04, 2019 7:13 am
This is found money from a settlement from bad dental work. She stills needs dental work. At what age would that be all right to start doing? I would think that would be a priority. Bad teeth can have consequences that accelerate. Plus there is a social side to bad teeth, both on self image and how others perceive you. Your niece does not need any of that sort of problem. So to me, the first step is not how to disperse or arrange the money, it would be to get at dental work done. I would prioritize that over looking at the money as some sort of windfall for life.
They can’t do the implants yet. She needs a little more time to develop before the bone grafts can be done. (1-2 years) Obviously, protecting the money needed for the dental work is a must. Yes, all your points are well taken.

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colageezer
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by colageezer » Sat May 04, 2019 8:18 am

Being a Boglehead, one thing that sticks in mind is that, if there were a way to carve out some block of this settlement for a target date retirement fund, in fifty years it could represent a very significant amount of money for her security. I’m not smart enough to figure out though who would manage the taxes on that, track her whereabouts, and see that she didn’t raid it prematurely. I just know that, absent some planning ... it is not likely to be well utilized or long lived.

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Re: Settlement options for a special needs minor about to receive personal injury award

Post by cheese_breath » Sat May 04, 2019 8:33 am

colageezer wrote:
Sat May 04, 2019 8:18 am
Being a Boglehead, one thing that sticks in mind is that, if there were a way to carve out some block of this settlement for a target date retirement fund, in fifty years it could represent a very significant amount of money for her security. I’m not smart enough to figure out though who would manage the taxes on that, track her whereabouts, and see that she didn’t raid it prematurely. I just know that, absent some planning ... it is not likely to be well utilized or long lived.
An estates lawyer can set up a trust for safeguarding the financial aspects. The trustee would be responsible for insuring the taxes got paid. Just be careful if he wants to refer you to a FA who can 'help' you with the investments.
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by bayview » Sat May 04, 2019 8:36 am

Question for all: does OP as uncle have any legal standing here since the mother’s rights haven’t been terminated?

If she’s planning on mis-spending any of this money, she won’t appreciate his “meddling.” Any way around this? It doesn’t seem like the school is interested in advocating for the niece.
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by epargnant » Sat May 04, 2019 8:38 am

I feel like we’re missing the obvious- to do a special needs trust doesn’t the beneficiary need to have an identified disability?

This is a very serious problem, and goes way beyond the settlement. In my state of VA a person has to have their from-birth disability identified before age 18 to receive life-long disability benefits such as medicaid and SSI if she is eligible. Afterwards I’ve heard it can be very difficult or next to impossible. Also having guardianship assigned is much easier pre-18 than post. She needs to be evaluated asap by her school system or Doctor or both. In my county kids with identified disabilities can remain in the school system until age 21, and there are special schools/classes and vocational programs for them (also at the state level).

If the grandmother has guardianship like you say, then couldn’t she push for this without the parent’s consent? I don’t quite understand that situation. Perhaps she’s guardian but major decisions still have to be agreed upon by the mother?

Luckily this neice has you fighting for her, and the next year could really make a difference for her entire life.

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Re: Settlement options for a special needs minor about to receive personal injury award

Post by cheese_breath » Sat May 04, 2019 8:42 am

bayview wrote:
Sat May 04, 2019 8:36 am
Question for all: does OP as uncle have any legal standing here since the mother’s rights haven’t been terminated?

If she’s planning on mis-spending any of this money, she won’t appreciate his “meddling.” Any way around this? It doesn’t seem like the school is interested in advocating for the niece.
That's why I suggested the grandmother, who is the legal guardian, accompany OP to see the lawyer.
The surest way to know the future is when it becomes the past.

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colageezer
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by colageezer » Sat May 04, 2019 9:38 am

epargnant wrote:
Sat May 04, 2019 8:38 am
I feel like we’re missing the obvious- to do a special needs trust doesn’t the beneficiary need to have an identified disability?

This is a very serious problem, and goes way beyond the settlement. In my state of VA a person has to have their from-birth disability identified before age 18 to receive life-long disability benefits such as medicaid and SSI if she is eligible. Afterwards I’ve heard it can be very difficult or next to impossible. Also having guardianship assigned is much easier pre-18 than post. She needs to be evaluated asap by her school system or Doctor or both. In my county kids with identified disabilities can remain in the school system until age 21, and there are special schools/classes and vocational programs for them (also at the state level).

If the grandmother has guardianship like you say, then couldn’t she push for this without the parent’s consent? I don’t quite understand that situation. Perhaps she’s guardian but major decisions still have to be agreed upon by the mother?

Luckily this neice has you fighting for her, and the next year could really make a difference for her entire life.
Let me try to run some of that down next week. I know she’s been tested, think she has a diagnosis, and know that she has received services through a counseling/mental health center in Virginia, which is where she resides. She does currently receive Medicaid. Her mother was in jail on drug charges for at least six of her seventeen years ... two separate spans. She was a mess for everything before that. She appears to have done relatively well the last two plus years since her last release. She pays her own bills with house cleaning jobs and seems clean ... but we never really know, nor can we trust, how well we think she’s actually doing. She is subject to probation and ongoing testing.
The grandmother has legal custody, but the child is living with her mother mostly. The mother unquestionably loves her daughter, but generally resists anything that makes good sense to most people. I’m just hopeful that I can protect my niece from her mother’s inclination toward bad choices.
Thanks for your insights.

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Re: Settlement options for a special needs minor about to receive personal injury award

Post by cheese_breath » Sat May 04, 2019 10:05 am

colageezer wrote:
Sat May 04, 2019 9:38 am
epargnant wrote:
Sat May 04, 2019 8:38 am
I feel like we’re missing the obvious- to do a special needs trust doesn’t the beneficiary need to have an identified disability?

This is a very serious problem, and goes way beyond the settlement. In my state of VA a person has to have their from-birth disability identified before age 18 to receive life-long disability benefits such as medicaid and SSI if she is eligible. Afterwards I’ve heard it can be very difficult or next to impossible. Also having guardianship assigned is much easier pre-18 than post. She needs to be evaluated asap by her school system or Doctor or both. In my county kids with identified disabilities can remain in the school system until age 21, and there are special schools/classes and vocational programs for them (also at the state level).

If the grandmother has guardianship like you say, then couldn’t she push for this without the parent’s consent? I don’t quite understand that situation. Perhaps she’s guardian but major decisions still have to be agreed upon by the mother?

Luckily this neice has you fighting for her, and the next year could really make a difference for her entire life.
Let me try to run some of that down next week. I know she’s been tested, think she has a diagnosis, and know that she has received services through a counseling/mental health center in Virginia, which is where she resides. She does currently receive Medicaid....
In your original post you said she lives with her mother. Are you now saying she lives at the mental health center, or are you saying she and her mother live in Virginia?

Sheltering the settlement money from Medicaid is another thing to be discussed with the estates attorney.
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by Nutmeg » Sat May 04, 2019 10:34 am

This is an excellent website, to which I have referred often:

https://www.specialneedsalliance.org/

Particularly helpful pages in your case might be those for FAQs, special needs attorney listings, “The Voice” (newsletter) and Publications.

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colageezer
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by colageezer » Sat May 04, 2019 10:42 am

cheese_breath wrote:
Sat May 04, 2019 10:05 am
colageezer wrote:
Sat May 04, 2019 9:38 am
epargnant wrote:
Sat May 04, 2019 8:38 am
I feel like we’re missing the obvious- to do a special needs trust doesn’t the beneficiary need to have an identified disability?

This is a very serious problem, and goes way beyond the settlement. In my state of VA a person has to have their from-birth disability identified before age 18 to receive life-long disability benefits such as medicaid and SSI if she is eligible. Afterwards I’ve heard it can be very difficult or next to impossible. Also having guardianship assigned is much easier pre-18 than post. She needs to be evaluated asap by her school system or Doctor or both. In my county kids with identified disabilities can remain in the school system until age 21, and there are special schools/classes and vocational programs for them (also at the state level).

If the grandmother has guardianship like you say, then couldn’t she push for this without the parent’s consent? I don’t quite understand that situation. Perhaps she’s guardian but major decisions still have to be agreed upon by the mother?

Luckily this neice has you fighting for her, and the next year could really make a difference for her entire life.
Let me try to run some of that down next week. I know she’s been tested, think she has a diagnosis, and know that she has received services through a counseling/mental health center in Virginia, which is where she resides. She does currently receive Medicaid....
In your original post you said she lives with her mother. Are you now saying she lives at the mental health center, or are you saying she and her mother live in Virginia?

Sheltering the settlement money from Medicaid is another thing to be discussed with the estates attorney.
Sorry, she resides in Virginia with her mother. She has received services, testing and counseling from a center in Virginia.

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colageezer
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by colageezer » Sat May 04, 2019 11:06 am

Nutmeg wrote:
Sat May 04, 2019 10:34 am
This is an excellent website, to which I have referred often:

https://www.specialneedsalliance.org/

Particularly helpful pages in your case might be those for FAQs, special needs attorney listings, “The Voice” (newsletter) and Publications.
Thank you. This looks very helpful.

epargnant
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Re: Settlement options for a special needs minor about to receive personal injury award

Post by epargnant » Sat May 04, 2019 11:33 am

I think there are some differences between Medicaid for low income and Medicaid for disability. For example if it is disability-based then she could get married but might be able to keep her Medicaid benefits because they would be based on her own income/assets and not her spouse's. Just a thought to determine which she has. Also if eligible for disability Medicaid she could also be eligible for SSI when she turns 18 depending on the severity of her disability.

Very good point from another poster that this settlement needs to be put in some type of trust that doesn't violate the Medicaid asset rules!

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