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Ask Dave

She Needs Something Special

Christina's daughter has autism, and college probably isn't in her future. How else can they save for her?

QUESTION: Christina has a daughter with autism. They are doing their Baby Steps, but they don’t think college planning is in her future. What should they save for regarding her? Dave tells her, and mentions a special needs trust.

ANSWER: The first thing you’d do as you get to Baby Step 5 is to open a mutual fund in your name that you label with her name. It in your name and you’re in control of it. In the meantime, part of your estate plan needs to be a special needs trust. That trust would be funded out of your life insurance proceeds. In other words, someday when you have a lot of money, assign some of that to the special needs trust and then you won’t need life insurance. Until then, your child needs more than that $50 you put in each month, so you need the life insurance