DisCo:: Disability Future Planning

Being the carer of a person with a disability carries huge responsibility. What happens though, when you are no longer able to look after that person? This can be majorly concerning for you, especially when it relates to family members. The majority of individuals with disability can make active decisions about their future, however, there are some people who are unable to participate directly within that process.

In these circumstances, you may wish to provide ongoing financial assistance for family members but are confused by the financial and legal jargon, are unsure how things should be structured, what questions to ask and where to go for further assistance.

The following provides an overview into the different areas, however, is by no means legal documentation or advice. You should seek the services of a professional lawyer when consulting about your future financial wishes.

What is a Will?

A Will is a legal document that clearly sets out how you wish your assets to be distributed after you have passed away. Ensuring that your Will is up-to-date is the best method for protecting your assets and making sure that they are distributed in the way that you wished.

It is probably the most important document you will sign, therefore, it is imperative that you seek legal guidance and expertise when preparing it.

If you haven’t prepared a Will, no one will know how you want your assets to be split up and who should receive what. Your assets will be distributed to a set formula.

What are Assets?

An asset is an item of property that is owned by a person or company and is regarded as having value.

Examples of assets can include jewellery, artwork, savings accounts, houses, land and car. There are a lot more examples available.

What is a Trust?

A trust is a legal concept that can look complex, but when explained, are easier to understand.

A trust is a legal obligation placed on one person, called the trustee, to look after the assets of the trust for the benefit of another person or a number of people, called a beneficiary or beneficiaries.

A trust is a good way to control the assets for the benefit of a person with disability. A trust can continue to look after some of the interests of a person with disability after your death. It is a structure you set up to operate before or after your death, which can continue into the future.

The main decisions required to make up a trust are:

- Who will be the trustees?

- How will the assets be divided up fairly between the person with the disability and other family members?

- What accommodation and care options should be provided for?

- How much discretion and direction should the trustee have?

What do Trustees do?

The trustee is the person or persons who have the right to administer and control the trust’s assets, but only for the benefit of the beneficiary, in this example, the person with disability.

The recipient will gain from the trust, without having control over the trust itself.

Who should be appointed trustee?

This is an extremely important decision, however, legal structures do not always guarantee that individuals will do the right thing.

That person should share the same views about how your family member should be looked after by the trust.

What is a Special Disability Trust?

A Special Disability Trust is the provision of social security and veterans’ affairs means test concessions, set up by the Australian Government to help families with planning their estates. A Special Disability Trust can be set up by anybody for a person with severe disability, as long as certain legislative conditions are met.

People are encouraged to make their own provision for accommodation and care costs for family members with severe disability. This type of trust may alieve concerns about how funds held in trust may affect entitlements. However, if the assets are limited and reduction of social security entitlements is not a significant risk, a Special Disability Trust may not be relevant.

Trusts and Wills and when to choose the right option

You do not have to make special arrangements for a family member with disability. This will be dependent upon the abilities of the person with disability, available resources and future wishes.

If the person can manage their own money or through an informal process, there is less need for special arrangements. They can be left money through your Will or Trust as other family members would. There are certain times when special arrangements should be put into place:

- If the person’s disability affects their mental capacity (intellectual disability, brain injury, mental illness or dementia) – they may need help with managing money or assets

- Or if you want to keep more control than usual over how family resources are used in the long-run

Issues for Consideration

Information to take to the Solicitor

If you would like a more accessible version of these questions, contact IDEAS' Information Officers on 180 029 904 or contact us.

Easy English Wills

It is essential that everyone has an understanding of what wills are and how they would like their assets to be distributed. The following Easy English guide is a template to help every one with the planning process.