As long as I can remember, I've been a neat freak. My closet, bedroom, desk, and dresser drawers were always tidy and organized with meticulous care. This trait followed me wherever I went. I remember one day, looking at the stickers at Target, and they were all out of order. Not being able to stand […]
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As a parent or guardian of a young adult with disabilities, you know full well that your child may or may not need help making important decisions, financial or otherwise. There’s no one-size-fits-all solution to special needs guardianship, but there are there are degrees of need when it comes to guardianship.
This guide will help you know what to expect financially if you do decide to become a guardian of your child or loved one. It’s sometimes tricky to be sure you’re making the right decision for everyone, but this article will guide you through how parents and other interested parties can become legal guardians of a young adult with disabilities.
As soon as a young adult turns 18, parental authority no longer exists. You must then decide whether to seek guardianship, or decision-making authority for the child. The person given the authority to make decisions is called a guardian. Financial decisions can be some of the most challenging for a disabled young adult. Managing bank accounts, investments, small and major purchases and more are some of the most valuable ways in which a guardian can help an incapacitated person.
There are good reasons why you may want to be the legal guardian of your disabled young adult if you’re a parent (or even if you’re not a disabled young adult’s parent). Specifically, a guardian is appointed by the courts, and the laws are different in every state. Once a disabled young adult has a guardian appointed to him, he’s then called a “ward” or “respondent.”
There are two types of guardianship: guardianship of the person and guardianship of financial matters, says says Margaret “Pegi” S. Price, J.D., a family lawyer and is the author of the book, “The Special Needs Child and Divorce: A Practical Guide to Evaluating and Handling Cases.”
Guardianship of the person involves making decisions about and managing the person’s care. Guardians (who can also be called conservators) must act in the ward’s best interests. The powers and duties of a guardian or those which the court may grant to a conservator include, but are not limited to:
Guardianship of the financial matters is also called a conservatorship. This guardian will use the ward’s assets or income to pay the ward’s bills and apply for government assistance like Social Security disability benefits (SSDI) Supplemental Security Income (SSI), Medicaid or Medicare, as well as other programs. This guardian will handle insurance issues and all other financial matters on behalf of the ward, including the power to approve or withhold approval of any contract involving finances.
Many families think they don’t need to worry about these factors until a disabled child turns 18, but that’s not true.
“What happens if something happens to the parents before the child turns 18? We also make the mistake of assuming that because the child has a disability, the child needs a guardian,” Price says.
Not every child who has disabilities needs to have a guardian. If the child is able to make good decisions, then he or she may not need full guardianship. Price cautions those considering guardianship not to assume that because there’s a disability “label” or diagnosis, that there should be a cookie-cutter approach to everyone with special needs.
“Just because a person has a disability doesn’t mean they can’t think for themselves or make a decision. They might actually be a genius at financial matters but not be able to figure out how to keep groceries in the house. Some need help with daily things, everyday living things,” Price said.
Anyone considering guardianship must understand the full ramifications of changing a disabled person’s status to incapacitated. Once the judge finds a person incapacitated, the disabled person loses his right to enter into contracts, sign a lease, make significant purchases like a house, make a will or living trust or get a loan or mortgage.
A guardian must be 18 years old, a resident of the United States, not of unsound mind, not disabled and not be convicted of a felony, according to Protected Tomorrows. Public agency or not-for-profit corporations found capable by the court of providing care required and a corporation willing to accept and execute trusts may also serve as guardian of the estate.
Most states have an ordered preference of who serves as guardians of an adult child with disabilities. The preference is usually for the parents. If parents are not available, an adult sibling or other adult family member is the next best choice. If no family members are able to serve as guardian, the task may go to a close friend. If no friends are available, then the court can appoint a professional guardian.
A guardian might be necessary when the child is unable to make decisions in his or her own best interest or provide for his or her own welfare.
Here are the steps to getting legal guardianship:
| Type | Description |
| Power of Attorney | Power of Attorney (POA) is not a type of guardianship. An incapacitated young adult who is incompetent because of a severe disability does not have the legal capacity to grant anyone the authority to act on her behalf through a POA. |
| Full Guardianship | A guardian with all powers allowed by law is called a plenary guardian, or a full guardian. |
| Partial Guardianship | A guardian with only some powers is called a partial guardian or limited guardian. |
| Conservatorship | A conservatorship grants those who are court-appointed the power to make estate planning decisions for someone who is incapacitated and unable to manage his or her affairs. |
Top of mind for many families are the legal fees they’ll incur. The full costs will depend on many factors, such as how complicated your particular case is, the number of hearings the lawyer has to attend, the amount of investigation and documentation the court requires and whether the proposed guardian and family is easy to work with.
“If the family is easy to work with, provides all the information the lawyer needs, aren’t squabbling among themselves and shows up at all the hearings — if people just act like civilized, intelligent professionals throughout, then the costs really don’t have to be that much,” says Price.
Here is a list of legal fees and their general cost, though it can vary widely by location:
Person representing the alleged disabled person: Will look at medical records, meet with the disabled person, find out that person’s wishes, meet the proposed guardian(s) and write a report: Around $3,000 and approximately $250 per hour
After the guardianship has been established, court costs, attorneys’ fees for both the petitioner and the proposed ward/protected person and any ongoing guardian fees are all paid from the protected person’s estate. Guardians are also allowed to charge a fee for their services. The county court or social services department may have a policy regarding paying for some of these costs if the ward has no money to pay for guardianship services. Review your financial situation regularly to determine how you can best afford to take care of your loved one.
In the vast majority of cases, the family members (usually the parents of the ward) pay the legal fees and court costs for guardianship, though some charitable organizations cover or help with the costs of guardianship.
Social Security Disability Insurance (SSDI) offers benefits to those who are disabled or blind and are “insured” by workers’ contributions to the Social Security trust fund. These contributions are based on the disabled person’s earnings as required by the Federal Insurance Contributions Act (FICA). The amount of your monthly disability benefit is based on your lifetime average earnings covered by Social Security.
Supplemental Security Income (SSI), on the other hand, is a federal income supplement program funded by general tax revenue. SSI is designed to help aged, blind and disabled individuals who have little to no income and provides cash to meet basic needs for food, clothing and shelter.
The low-income aspect of Medicaid requirements can make it the best and most affordable option for health care for disabled young adults. Medicaid provides basic medical care to low-income individuals. Most states also have Medicaid programs covering residential, day care, career and other services.
A personal loan is one way you can pay the costs of guardianship. You’ll need to prove that you’re a good candidate to pay back a personal loan through a credit check. Personal loan is an unsecured loan, which means you don’t have to put up collateral (like a car or house) to get one. Fixed interest rates, good credit scores and fixed monthly payments are some of the main characteristics of a personal loan and can cover some of the costs for guardianship or other needs for the disabled young adult’s care.
Legal aid organization funding can help with fees or handle them completely. Legal Services Corporation (LSC) provides financial support for civil legal aid to low-income Americans. Find a legal aid organization near you.
You could also consider a special needs trust, which enables assets to be held on behalf of someone with disabilities without affecting their eligibility for government aid like Medicaid or SSI. For example, if a well-intentioned aunt decides to leave money to the disabled person upon the aunt’s death, the disabled person may make too much to be able to receive disability. Price recommends getting a lawyer to set up a special needs trust. “Do not use an online form. It’ll vary so much by state,” she says.
Ultimately, when you’re considering guardianship, remember to balance your child’s financial needs with your own. It’s a good idea to consult with a financial expert if necessary and talk to an estate planning attorney to consider your life insurance policy, particularly if you’re the parent of a disabled young adult.
“Always keep in mind how a guardianship or conservatorship will affect the person’s rights to act on her own behalf,” Price says. “Try to achieve what is best for the person by using the least-restrictive means possible. Do everything you can to honor the disabled person’s pride and dignity.”
The post Guardianship for Young Adults with Disabilities: What to Expect and How to Afford It appeared first on The Simple Dollar.
If you need to borrow money for college, you’ll want to start with federal student loans instead of private student loans.
What’s the difference? Private loans typically come from lenders like banks or credit unions and tend to be more expensive, while federal loans come from the government and offer flexibility, with options like income-based repayment and loan forgiveness.
However, you might need a private student loan if you can’t borrow enough in federal loans to cover your tuition and other college costs.
If that’s the case, make sure to shop around for a good interest rate. One quick and easy way to do that is through Credible. Credible is a private-student-loan marketplace where multiple lenders will compete for your business.
Whether you’re a student or a parent who’s co-signing a student’s loan, you can type in some basic information and see multiple loan offers within minutes. You can compare loan terms and interest rates, which start at 3.99% APR for variable-rate loans and 4.50% APR for fixed-rate loans.
It’s important to get the best interest rate you can find, because interest rates for private student loans can rise as high as 14%. A lower interest rate could save you thousands of dollars over the life of the loan.
If you find a loan you like, you can apply directly on the site. Plus, none of your info is shared with the lenders until you’ve chosen a lender and loan option that’s right for you.
So you really have nothing to lose by shopping around. Comparison-shopping is always a good idea, whether you’re looking for a new car, a new phone or a student loan. Credible makes it easy.
Mike Brassfield (mike@thepennyhoarder.com) is a senior writer at The Penny Hoarder.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. Telecommuting in the country?
2. Military retirement question
3. Cheap alternatives to AirPods
4. Stuff now, money later?
5. Youtube or Spotify?
6. Bad luck with scholarships
7. Choosing car insurance
8. Son getting into Magic cards
9. Gold coins in bank box?
10. Retirement fluctuations feel abstract
11. Why I love the library
12. My summer reading list
One of the toughest parts of the reader mailbag is editing the questions.
Most of the questions I receive need a little bit of editing, usually because there are elements to the question that could reveal the identity of the person writing the question. They’ll mention a specific employer or give specific dates or timeframes or dollar amounts or name specific people. I’ve learned in the past that it can be very bad for people if their identity is clear or suspected from mailbag questions (for example, if a person is considering a divorce or retirement or something like that and hasn’t discussed it with their partner or employer), even seemingly innocuous ones, so I want to “blur” those elements as much as possible without disrupting the value of the answer to the question. Mostly, I’m trying to keep out their specific identity while retaining as much of their actual question as possible.
Sometimes, that forms a very fine line. How much “blurring” is too much? In the end, if I’m in doubt at all, I err on behalf of keeping identifying details out of the mailbag. Sometimes that verges on changing the nature of the question a little bit, but it still remains useful to the thousands and thousands of people who read the mailbag column each week.
My aim is to help people, and part of that is to never disrupt lives.
On with the questions.
I got a new job in the Boston area that allows people to work remotely as long as you go to a quarterly retreat in the Boston area. I’m burned out living in cities and want to live in a rural area or small town. It’s cheaper and a lot less crowded.
My main concern is quality of internet service. Some rural areas apparently still use dial-up which is a non-starter for my work. Is there a way to screen for rural areas with good internet access?
– Adam
I live on the edge of a pretty small Iowa town and I have internet service that never seems to go lower than about 150 Mbps and is usually around 400 Mbps, which is near the upper limit of 802.11n wireless.
My advice is to look for small towns that are within 20-30 miles of a college town (or perhaps actually a college town) and start filtering from there. Most small towns near college towns tend to be bedroom communities for people who want to live in small town areas, but they also typically demand good internet service, so in many such areas internet cooperatives have emerged or else the providers in the college towns have extended out to the surrounding towns.
If you’re looking to stick in New England, I’d look at the areas around Hanover, NH; New Haven, CT; and Burlington, VT. Those would be an easy drive from the Boston area and would be quite rural.
If you’re wanting to go further away, the country really is your oyster.
Next May I will be eligible to retire from the military with 21 years of service, meaning I am eligible for High 36 retirement and will receive 52.5% of my annual salary for life if I retire at that point. My CO is strongly encouraging me to reenlist but I haven’t made up my mind. Reenlistment would keep me in for several more years and bump up my retirement percentage to around 65%, enough that I could probably live off of it if I wanted to. Not sure I’d want to make it off of 52.5%. I enjoy the work and routine and I’m not sure what I would do if I leave but I also don’t want to be one of the old guys hobbling around. I have been very careful with my pay and have about $45K in savings. What would you do in my situation?
– Gary
First of all, thank you for your service. I have had several family members serve and I know it has a lot of challenges, personally and professionally.
In your situation, the one question on my mind would be what exactly I would do if I didn’t reenlist.
I’m estimating from this story that you’re in your very late thirties to mid forties. Your writing makes you appear well spoken, which is a good sign. I don’t know what your service has provided you with in terms of employable skills and experience, so the first thing I’d do is figure out what your skills translate to in civilian life. Are those things you would be happy doing? Are those fields in demand enough that you could get a good job in those fields (I’m sure your service record, if it’s good enough that your CO wants you to reenlist, is a positive)?
At this point, your finances are in great shape, so if I were you, I’d simply choose the path that seems like it would give you the most fulfilling daily life. A military pension is a rock solid one, and with the additional money you have saved, you’ll be in good financial shape no matter which way you choose. So, choose the one that you feel will give you the best life throughout your forties and fifties, until you choose to fully retire.
My daughter wants Air Pods for her birthday but it seems ridiculous to me to spend $160 for ear buds. Is there a less expensive alternative to wireless ear buds that work just as well without the Apple markup?
– Kevin
The cheapest wireless ear buds that I know of that supposedly do a good job are these JBuds for $50. The biggest difference I’ve seen between them and AirPods are the color/design, the distance you can hold them from your phone without losing signal (it’s a little less for these), and there’s a fraction of a second latency that’s barely noticeable when watching videos (it doesn’t matter when just listening to music or podcasts). They’re probably the bargain ones I’d get.
If your daughter is an athlete and runs a lot, you may want to also look at these Jabra Elite Sport wireless earbuds. They’re similar to AirPods, but they also function as a heart rate monitor and have other useful functions for runners. The MSRP on these is similar to AirPods, but these pop up on sale pretty frequently.
If you decide to go the AirPods route, you can find them fairly regularly below MSRP on eBay, but pay careful attention to the seller when buying.
I’ve been struggling a lot with your suggestion to think about whether you’d rather have stuff now or money later. Almost always I’d rather have the stuff now so your suggestion isn’t helping.
– Chris
It didn’t help me either, at first.
For me, that question is a reminder of the things I want in life beyond that thing I happen to hold in my hand at the moment. I have spent a lot of time thinking carefully about what it is I want from my future, and I recognize that what I want more than anything else is financial freedom. I want to be able to wake up in the morning and have only responsibilities I’ve chosen because they’re important to me, not responsibilities I have to take on because I need to make money. That’s my dream, and it’s a strong one.
When I look at an object in my hand and I ask myself whether it’s worth putting off that dream for a day or a week or whatever, I become quickly hesitant to buy it. After that, I ask myself whether this item is really going to add anything meaningful to my life, and almost always, by that point, the object is back on the shelf.
Both of those realizations took time to actually work. They didn’t work well at first. They both required some reflection on what I want from the future and, frankly, what I want from right now. Temptation is a tricky thing, but once you start to see past it, it loses a lot of strength.
If I can just listen to music all day from Youtube for free, why should I ever pay for Spotify? I don’t get the point.
– Jenna
I’m not trying to sway you one way or another with this; I’m just attempting to clarify what you get with Spotify.
First of all, a paid Spotify account doesn’t have ads in it. Whenever I find myself listening to Youtube and having songs auto-load, there’s almost always an ad between each song.
Second, Spotify works really well on mobile and allows you to download the music so that you don’t have to use data to listen to it when you’re out and about. It works far better than just listening to Youtube videos if you have a limited data plan and aren’t always in LTE range.
Third, Spotify does a really good job with playlists, which helps a lot with discovering new music and listening to batches of music you want to listen to.
I’m not saying people should subscribe to it, but if you listen to music for a large portion of your day, particularly when out and about, Spotify might be a worthwhile expense for you.
My son just graduated high school and is entering college in the fall. He spent a ton of time applying for scholarships all through the school year and managed to get a whopping $500. He would have been better off working at Subway. What a rip.
– Alice
Most scholarships that are well-promoted, particularly ones with a wide range of eligibility, tend to be utterly inundated with responses. They’re offering four scholarships and get a thousand entries. Often, they barely have the staff to even look at all of the entries, so they do a very quick filter on the entries and narrow it down fast, often eliminating good candidates out of expediency.
So, what can a person looking for scholarships do?
My best advice is to look locally for scholarships. Try to find ones that mostly apply to students in your area. My experience has been that if the parents or the family is involved in a community group and that community group offers any sort of scholarship, those kids have a very very strong chance of getting one.
So, my advice for parents with kids that may be angling for scholarships in the near future is to get involved with the community. Find some organizations that you can get involved with in a meaningful way and dive in, but don’t just do it for the scholarship. Do it for the purpose, and for the personal experience and growth. Do that and opportunities are much more likely to reveal themselves.
Shopping around for car insurance. How do you choose between policies that have similar prices? I mean which one is better? I have four quotes that are basically identical.
– Erin
My advice would be to check out the Consumer Reports car insurance buying guide. They do a really thorough job of comparing insurers. Unfortunately, their full comparison of insurers is behind a paywall.
So, what can you do? If I were you, I’d hit the library and look through their back issues of Consumer Reports – it’s a magazine that most libraries carry. It looks like the most recent issue that had side-by-side comparisons of auto insurance providers was the March 2017 issue. I would expect that another comparison will be forthcoming in the near future, so I’d look at very recent issues, too.
My experience has been that most of the really big car insurance providers were all bunched up together with fairly similar ratings, but I’m not sure which four insurers you have quotes from. In general, if they seem really similar, go with the one that has good customer service scores and has a high satisfaction rating from customers, which you’ll find in that Consumer Reports article.
My 13 year old son and a few of his friends are getting into Magic: the Gathering. A local shop gave them some free decks and a bunch of cards and they seem to be happily building decks to play with each other at lunch. However, it seems to be a really expensive hobby to get into. Do you have any suggestions for keeping it low cost?
– Adam
Magic really only gets expensive if you want to play in tournaments, which almost require you to spend quite a lot to build competitive decks. The nature of the free market is that when certain cards prove themselves to be very strong on the tournament scene, they become expensive to buy as individual cards, and opening packs is very random.
My suggestion would be to encourage your son to avoid the popular constructed tournament formats and instead stick to casual formats. If he really wants to play in an occasional tournament, the least expensive format is draft, which has an entry fee of around $10 to play, requires no cards of your own, and you get cards while playing to keep. Sealed tournaments and prereleases would be largely okay, too.
As for buying packs, let him decide if he wants to spend his own money on them or not. They do make an easy small gift for people who are into the game.
As some readers know, I played Magic when the game was first introduced back in the 1990s and I have a binder full of old cards and a few decks from those days. My son went through a Magic phase recently and I let him play with a few of my old decks, but he was mostly interested in playing with a lot of commons given to him by a local shop, much as your son, and the fad seems to have passed for him.
My father in law has a whole bunch of gold coins stored in his safe deposit box at his bank. He does not trust 401(k) or the stock market so this is his retirement plan of sorts. He is 59 and he buys a gold coin really regularly and puts it in there. He says that he will sell them as needed when he retires. He plans on working until full Social Security and then retiring. My worry is that this won’t actually sustain him and he’s going to wind up being our financial responsibility. What do you think?
– Jane
It depends on how full that safe deposit box is.
However, in general, I think this is a very unstable idea for retirement. For one, gold is an extremely volatile investment. It routinely fluctuates in value as much as 30% within a single year. Recently, it doubled in value from mid-2009 to mid-2011, then lost almost all of those gains by mid-2013. The long term history of gold shows routine wide fluctuations in value like this.
Now, if gold maintains its value or even spikes in value, this will work out fine for him. However, if the price of gold drops rapidly, as it has in the past, he will need a lot of gold to make ends meet.
I would strongly encourage your father-in-law to assess the cash value of his gold coins and make sure that it not only accounts for enough to meet his retirement needs, but has a nice buffer to handle some significant fluctuation in value.
When I first started reading The Simple Dollar several years ago, one of the things I read that you wrote seemed like crazy talk to me. You said something to the effect that you were able to just not pay any attention to big changes in your retirement accounts. It was after some 5% or 10% market drop and a reader was kind of panicking about losing $50K in retirement and your response was “Well, stop looking at it.” That struck me as weird and nonchalant.
Fast forward to now. I just realized that I now feel exactly this way. I’ve been contributing to my workplace 401(k) a lot over the past seven or eight years and the balance is somewhere between $150K and $200K. The thing is I don’t even look at the balance any more other than a rare check to make sure things are okay. If the stock market drops 5%, I barely even notice it even though that represents a loss of $10K or $15K. I think that I’ll feel this exact same way until I get close to retirement age.
I think it’s because these losses don’t impact my daily life in any way and because I know such losses are temporary. The market will rebound and I won’t need the money for a very long time, so what difference does it make that the market drops 5%? They just feel abstract. Funny how old comments that stick in your head because they didn’t make sense suddenly make sense after a while.
– Dan
This is exactly how I feel about changes in my retirement savings balance due to market fluctuations. There’s really no need for me to look at them because the market is pretty volatile. It’ll go up and it’ll go down and it really doesn’t make one iota of difference to me in terms of my life right now. I’m far enough away from needing to use that money that such fluctuations really don’t matter.
Now, there will come a time when I care, and when that happens, I will start dialing investments back into more secure investments with less day to day volatility, but the truth is that if I’m not touching that stock market money for more than ten years, I honestly do not care what it does on a daily basis. It just does not impact me.
I like the word “abstract.” I mean, I’m aware that the market is going up and down and it does mean the value of my accounts are going up and down along with it, but it really doesn’t impact me at all. It’s my money, sure, but I’m not touching it for a good decade at the very least, so it just has no impact.
I just wanted to share that the biggest reason I love the library is the feeling I get of leaving the library with a bag full of books I’m excited to read. I didn’t pay a dime for those books (other than indirectly through library funding and so on) but I still get to take them home with me and get lost in them and hold them in my hands and learn from them. I get to have stacks of books I’m excited to read on my bedside table. It’s just a great feeling and it’s a free feeling!
– Tara
I feel the exact same way! After a library visit, when I go strolling out the door with those new books in my hand, it’s kind of a blissful feeling. It’s almost the same as leaving a bookstore with books in hand, but without that twinge of guilt of having spent a bunch of money on books that I’m not sure I’ll read more than once.
I’ll often end up checking out more books than I’ll probably be able to read before they’re all due to be returned, but the simple joy of having more books to read on my bedside table than I have time for is a real pleasure, and the fact that they’re all free adds to that sensibility.
And if you’re looking to grab some stuff from the library…
So what’s on your summer reading list? You used to mention them in your mailbag every year.
– Amy
Well, now’s as good a time as any! I have five books I intend to get through by the end of summer.
Why Buddhism Is True by Robert Wright is a book about how neuroscience and biochemistry provide scientific evidence for many of the tenets of secular Buddhism that I’m looking forward to rereading with fresh eyes. I wrote in depth about secular Buddhism and its value several months back and I’m eager to dig into the topic again.
Return of a King by William Dalrymple was recommended to me by a friend who said that it brought a period not well known in the West to beautiful, vibrant life. That period is 19th century Afghanistan, where the area was beset by British and Indian influence from the east and south and by Russian influence from the north.
Liberty or Death: The French Revolution by Peter McPhee was recommended to me by a historian as a great one-volume look at the French Revolution, a subject that’s always interested me but I’ve never dove into head-first, always looking at it from adjacent subjects.
Inspired by Rachel Held Evans is a re-read due to the untimely death of the author at age 37 earlier this year. She was a great voice and I (like many others) will miss her.
Atomic Habits by James Clear is actually a re-read of a book I’m likely to talk about soon on The Simple Dollar. The focus of this book is on developing very small habits that are a natural part of your day that gradually nudge your life in the direction you want it to go.
Beyond that, I’ll get some light fun reading in sometimes in the evenings, mostly fantasy and sci-fi novels. I’m currently reading Children of Time by Adrian Tchaikovsky.
Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.
The post Questions About AirPods, Telecommuting, Military Retirement, Gold Coins, and More! appeared first on The Simple Dollar.
