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A12 BUSINESS
Thursday 4 May 2023

Millennial Money: Trusts can aid those

with mental illness

By ELIZABETH AYOOLA of
NerdWallet
More than 50% of Ameri-
cans will be diagnosed
with a mental illness or dis-
order during their lifetime,
according to the Centers
for Disease Control and
Prevention. Chances are,
some of these individuals
will be inheriting wealth at
some point.
If a family member’s mental
health issues may interfere
with their ability to manage
finances, answering these
questions could help them In this Sept. 19, 2020 file photo, a couple stands on a jetty as
the sun rises over the Atlantic Ocean in Bal Harbour, Fla.
create long-term financial Associated Press
stability.
HAVE I SET UP A TRUST? anything else that helps For instance, to be eligible
Setting up a trust is one them live a healthy and for Supplemental Security
way to transfer wealth to functional life. Having a Income through Social Se-
a loved one and create fi- trust in place can also help curity, they generally can’t
nancial stability for them. A beneficiaries avoid pro- have resources of more
trust enables you to leave bate, a court process for than $2,000 as an individ-
specific instructions for handling estates that could ual or $3,000 as a couple.
trustees about how to care be stressful for someone That is, unless you put those
for your loved one and dis- who has a mental illness. assets into a special needs
tribute assets. DOES MY LOVED ONE RE- trust. It’s an estate plan-
Trusts can be especially CEIVE GOVERNMENT ASSIS- ning tool for individuals with
helpful for transferring as- TANCE? disabilities or functional
sets to loved ones who Another important question needs.
have a mental illness but to ask is whether the per- “The special needs trust is
are still able to function in- son receives government meant to supplement gov-
dependently. While these assistance or may need to ernment benefits that per-
loved ones are often in- in the future. While a basic son is receiving. It doesn’t
dependent, they may still trust may suffice for a loved replace it, it’s meant to
have difficulty managing one who has a mental ill- supplement it,” Nkenchor
assets on their own, says Lil- ness but mostly functions says.
lie Nkenchor, an attorney independently, it could Nkenchor adds that a stan-
who does estate planning negatively impact one dard special needs trust
in New York. One example who doesn’t and receives isn’t effective until the per-
includes someone with de- government assistance. son who establishes the
pression. “We want to make sure trust dies. So, if you plan
“You can put assets in a that if we are caring for to financially support your
trust,” Nkenchor says. “It someone who’s receiving loved one while you’re
can simply be a trust that that type of benefit, we alive while they receive
says, ‘This money is to be don’t accidentally leave benefits, consider setting
used to take care of my them something that dis- up a stand-alone special
sister who is high function- qualifies them from that needs trust. Since setting
ing, but is not great with benefit,” Nkenchor says. up a special needs trust
money.’” People who receive gov- can be complicated, it’s
Likewise, you can request ernment assistance may advisable you speak to a
money be allocated to have limits on how much professional who special-
health care expenses and they can have in assets. izes in this area. q