Disabled Lives Matter
Season 1, Episode 8
Co-Hosts: Nadine Vogel & Norma Stanley
Guest: Douglas Vogel
Intro: [Music playing in background] Disabled Lives Matter… here we go!
Voiceover: Hello and welcome to this week’s episode of the disabled lives matter podcast with co-hosts Nadine Vogel and Norma Stanley... yay!
Nadine Vogel: Hello, hello, this is Nadine Vogel your co-host of disabled lives matter, I’m with my co-host Norma.
Norma Stanley: Hi everyone.
Nadine Vogel: Norma and I started this podcast because well it's not just a podcast it's a movement we want people to really understand why disabled lives matter what you can contribute to show that you believe it and that you help you help people with disabilities be successful and show the rest of the world that their lives do matter and the way to help is not a cause to support or to just provide assistance but it's really to recognize that people with disabilities are people first and have skills and talents like anyone else. There are times, however, that we do need to provide additional support and especially when we're talking about children with disabilities, so I am very proud to welcome today to our podcast Doug Vogel. We've asked him to join us today because he has spent almost the last 30 working with families who have children with disabilities on planning for the future and ensuring that our kids not just have lifetime care, but quality of life so Doug welcome to the podcast.
Doug Vogel: Thank you it's nice to be here.
Nadine Vogel: So, talk to us a little bit about when we hear the term special needs estate planning, what does it even mean what are we talking about. Well, special needs estate planning is basically just getting your affairs in order so that when you die, and we all will die and statistically you can't beat that the probability of death is 100%. That you, you know can put a plan together to guarantee a couple of things like maybe if you have kids where they're going to go who's going to take care of them where the money is going to go where the money is going to come from who's going to be in control of that money. One of the things that we have to do as parents of children with disabilities or dependence with disabilities is make sure that we have the proper legal planning in place to protect eligibility for certain critical government benefits that might not be available for them, while they're minors, but when they become adults if they're not able to be independent and work then, these benefits are going to be critical as a safety net for them to provide support so generally estate planning twofold there's the legal stuff and the financial stuff and they kind of work hand in hand. And that’s estate planning in general and it's very unique when you have someone with a disability and your family.
Nadine Vogel: Why, what makes it unique what makes it different?
Doug Vogel: What makes it different is protecting eligibility for government benefits so basically, there are certain benefits that an individual with disabilities, a child or an adult at that point when they turn 18 potentially could be eligible. The first one is called SSI which stands for supplemental security income, which is basically a monthly subsistence that the government will pay a family of a minor child if they qualify to kind of offset the cost of basic needs. And it's means tested, meaning that you can't parents at that point if they have a minor child, they can’t have income and assets that are going to jeopardize this threshold and the asset test is basically $2,000 so if there's $2,000 in in the child's name and the parents make you know, roughly 30 something thousand dollars a year they're not going to qualify but when the child becomes an adult then they qualify on their own. And they don't care about the parents anymore, so if you do basic planning, where you have a typical will more than likely you're leaving assets to the minor child not directly if it's a well done correctly it's in a little discretionary juvenile trust, but that's not considered viable under the eyes of Medicaid and social security so it's going to jeopardize those benefits.
Nadine Vogel: So, let me ask you a question, so, even if the child is living at home right, they're 22 years old, they function as a 10-year-old. Their living at home, so what I hear you saying is that that $2,000 limit the government's not going to look at the parents’ income and assets anymore it's really just what's in that child's need.
Doug Vogel: Right when they turn 18. Right oh so that's why it's critical to plan a lot of families, you know they think well I make too much money now my I don't qualify these for these benefits. But eventually the child is going to become an adult, even though they might not have the capacity to function as an adult at 18. So, if they have over $2,000 in assets either inherited indirectly or directly the wrong way, that's going to be considered what the government calls dimmable and it's going to disqualify them from benefits. One of the themes that we have as parents, and I say parents, because I have an adult daughter with multiple disabilities so.
Nadine Vogel: As does Norma.
Doug Vogel: As does Norma, so we you know we live this every day and have for the last 30 years with our daughter. The difference between planning, when you have someone with a disability in your family is, we have a theme that runs through our planning that's different than the typical family and that theme is dependency, we have someone in our family that's going to be dependent on us or someone else when we're no longer here pretty much for the rest of their lives, now, depending upon what your child's abilities are and what their diagnosis is obviously is going to define that. But that's the difference between the way a typical family would plan, because you know we have to provide that support. And, and that strategy and to ensure that quality of life throughout a lifetime and that's why you have to create a legal strategy and a financial strategy that's different and unique to kind of put the best foot forward and stack the deck in your child's favorite.
Norma Stanley: Wow. I am so glad you're having this conversation this is like one of my favorite conversations, because you know it bothers me that so many families don't think of this and I’m you know it's something that stays on my mind, all the time, because you know my husband died young and you know, life is not guaranteed, you don't know from tomorrow what's going to happen and that's something that this particular situation. I just don't understand why families are so hesitant, because it seems sometimes a little hesitant to put this thing in place for their child, why do you think that is.
Doug Vogel: Well, you know I’ve been doing this for a long time as Nadine alluded to, when we first started and I've kind of asked my families for some feedback and there's a lot of common themes that I’ve heard from them that I could relate to because obviously you know we're parents have dependents with disabilities as well, the first reason people tell me they don't they don't address this stuff is they don't have time. And I can relate to that you know I mean when our daughter was young, she had 11 hours a week of therapy she hadn't nursing she was on machines, you know we still had to work. You know I think in the back of the mind most parents know that this is important but they're exhausted, at the end of the day. And they say you know what I’m just going to get to it tomorrow, and tomorrow turns into the next day, and the next day turns into next week and then next month, and then years go by and parents still don't do this stuff. Another reason why I hear parents don't do this, is they say, you know I just don't know who to choose, if something were to happen to me or my husband or both of us in a car accident who's going to fill our shoes, you know, should it be your sister-in-law, should it be you know another family member. You know, so people vacillate back and forth, and they kick the can down the road, and they don't make any decisions, but what I always tell people is their worst decision is better than the decision that's going to be handed down by the probate court in the state that they live in if they don't have a will, and they don't have any type of strategy. You know it's going to be hard enough dealing with everything, and if you know you're leaving it up to the State to kind of figure out how this stuff is all going to play out and then the bus has already left the station, because now assets are going to be left to your child and you don't want to leave assets to your child, so they have to be depleted to under $2,000 to qualify them for government benefits which in actuality is basic needs.
Norma Stanley: Right.
Doug Vogel: You know it's important it's a nominal existence really and who knows what government benefits are but it's important to protect because one of the things that we're protecting is the Medicaid piece, which is huge for someone who has a disability, you know I often I often ask people when I speak, and I do a lot of workshops and I speak at schools and organizations and conferences, you know I asked them what they think Medicaid is in their own words. And the first answer people always give me as well Medicaid is for you know older people, you know I remember my mother, you know talking about my grandfather trying to get him qualified for. You know, maybe a nursing home and moving his assets, because he couldn't you know have assets and so on, and you're right but that's a very, very small slice of the Medicaid pie another. Another answer people give me as Medicaid is for, you know, lower income families. Who don't have a job, where they have health insurance and you're right, that is a small slice of the Medicaid pie, but the biggest piece of the Medicaid pie is providing services and health care and support for people with disabilities so that's why it's so critical to protect the Medicaid benefit because, if someone is not able to be independent enough to support themselves in work, they are not going to have the health care to support them and to maintain that quality of life and people don't realize this, but they can only hold their children typically on their health insurance until they're 26. And then what are they going to do.
Nadine Vogel: I think you make an important point, though, when you said about the timing right because Norma, you shared with us you know that your husband did pass early and you actually didn't do the planning until after he passed so imagine if God forbid, both of you had passed, together, you would have been one of those statistics who hadn't done that, so I think you know from my perspective, you know what an especially its parent knows, above all else is the what if scenario. Right, what if, and then what's going to happen if.
Norma Stanley: that's right.
Nadine Vogel: So, you know I think Doug that you've painted this picture of you know what is a framework that we need to understand right. From a legal perspective, but I think that the other piece I’d really like to focus on after commercial break is this issue of the financial. Right, we hear from families, I don't have a money tree in the backyard, so you said, like Doug you know family say I don't know who to leave my child to who can handle it. Another thing that I know we all have heard is well I don't have the money to fund this special need trust right I don't know where the money is going to come from, and I think that that is so important because what I have found in talking with families is even when they figure out the special needs trust of the will or any of that. They can't get their head around the financial and what I’d like you to share when we come back from commercial is in some respects, if you focus on it that's one of the easier things you can actually do. Right, I’ve heard you say you can create a state where none existed before or hey so um let's go to commercial break after just a minute, and as soon as we come back Doug, I’d like you to talk about the funding part of this.
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Nadine Vogel: Hello, this is Nadine Vogel co-hosting with Norma Stanley on today's episode of disabled lives matter. And today Norman I are interviewing Doug Vogel talking about special needs estate planning. Doug before the break we I mentioned something about special needs trust and that's because I'm familiar with it so I’m wondering if you can just take a minute and talk about that and then maybe pivot to the funding and how this all come together.
Doug Vogel: Absolutely, absolutely so really the solution that we have as a planning strategy is to create a special needs trust or the legal East term is it's called a supplemental benefits trust.
And it's basically a trust that's created to ensure our government benefit eligibility for someone with a disability and there's no limit to the amount of money that can go in there, if you identify that your child's going to need you know several million dollars to maintain their quality of life over their life expectancy, then, then you can you know have that trust funded with those dollars. It has to be drafted by someone who knows what they're doing so, one of the things that I want to talk about are the pitfalls of planning that I see all the time when people come and see me and they bring in their stuff for me to review when we're going through the planning process where they've gone to an attorney that might be very proficient and maybe general planning and estate planning and tax planning, but they don't know anything about special needs planning. So, there's a subspecialty of attorneys that specialize in doing this, a lot of them are elder law attorneys but they don't have to be, but the majority of them are. So you want to make sure that it's grafted in the correct way to make sure that it's viable under the eyes of Medicaid and social security so basically a trust is a cup that receives what can receive assets, a house, but really to be worthwhile and the life of someone with a disability to provide that support and those resources it receives money. It either gets it now, or it gets it at some point in the future right for most of its it's at some point in the future when it's needed the most. And what is needed, the most when we're no longer there, because as long as we're here and we're healthy and we're viable and we're taking care of our loved one. You know they're going to be provided for it's in the event that we're not here, or we become incapacitated or disable that we need to have a strategy. So that's what a special needs trust it so if you had two children, you would make sure that that one child that has special needs, you would direct any assets that you're leaving to them to that trust.
Nadine Vogel: So when we you know I think it's important that in you know Norma you brought something up earlier about you know you had a trust and if you've learned recently and might not have been drafted appropriately and Doug you know I think it's important that you know you're not an attorney you're giving you know you're giving guidance, so that when people go see the Attorney they become familiar with what to ask, right, what to ask for, because I think one of the one of the things that I think scare, a lot of families. And Norma you can speak to this personally is you go to an attorney you have these trust on and then you find out leader if they weren't done appropriately because maybe the Attorney wasn't his or her expertise wasn't special needs planning right.
Norma Stanley: Exactly. That’s exactly what happened to me there was an attorney, and it was not done properly, and I didn't find out about that, until much later that was not happy so yeah, please talk about that so many people can avoid that the bottle.
Nadine Vogel: Right right the pitfalls right, you know, not knowing who to go to aware so Doug I know I keep we keep jumping around different topics, but can you talk a bit let's talk a little bit about funding. And so, how people make sure that the money is there for the child when it's needed and then maybe we can talk about some of these pitfalls like what Norma experienced.
Doug Vogel: Sure, sure well you know getting back to how I opened it up when you, you asked me what the definition of estate planning so there's two parts to estate planning there's the legal side in the financial side. And they actually go hand in hand, you know a lot of people think, just because they run out and they go see an attorney who specializes in doing and it's special needs planning and draft to trust that they've really done sound estate planning and it's a false sense of security because it's only half the estate plan because there needs to be a financial strategy to drive that legal platform because you know you're not just creating a plan to protect government benefits, because you know government benefits are basic needs. It's a nominal existence I don't want that, for my daughter, nor do pretty much most of the families actually every family that walks in my door. So there needs to be a financial strategy meeting their needs to be a way to fund the trust So how do we typically fund the trust if we're not Bill Gates or you know Rockefellers or we don't come from this very wealthy family where we can count on this inheritance being there because of our birthright well it comes from planning and everybody has the ability to plan I don't care, who you are I often tell people I don't care what your economic strata is I don't care, you know, everybody has the ability to plan. It's just taking a look at what you have and how to leverage it in the most cost effective way, so you know you can fund a trust with anything but one of the things that typically is the vehicle of choice because of the way it's designed and because of the guarantees that are inherent in in this way is through a life insurance strategy because life insurance creates assets were no assets exists, it does it income tax free and probate free and, more importantly, it guarantees as long as the policies enforce that the right amount of money is going to be there at the right time. And what is the right time, when you're no longer there so that's why special needs trust are partially funded with life insurance nine times out of 10. And it's not term insurance because term insurance is temporary, term insurance has had has a fit in planning to replace lost income during income earning years and you know, for spouses, while you have mortgages and things like that, but it can't be there to indemnify a trust over a lifetime. That's where permanent life insurance comes in, because permanent life insurance guarantees that that money is going to be there when you pass away whether it's prematurely or it's over a lifetime and there are certain types of life insurance that that a permanent life insurance that that tend to fit nicely one, for example, is called the second to die or survivorship policy. Where it ensures two people typically the husband and wife and it pays out when the second person dies not only conceptually does it work nicely right because that's when the monies really needed the most, it's very cost effective for most families, because they take a blend of the two of them. So, the insurance company can discount the premium generally by about 50% so for families, like us, who have this ongoing theme of dependency. You know, we can get a lot more for a lot less to do what it's intended to do, which is to create this estate, most of us are creating an estate right because we have to plan 30 and 40 years typically beyond our death for our children.
Norma Stanley: Wow.
Nadine Vogel: That’s important, Norma?
Norma Stanley: Yeah, this is wonderful news um you know so what does, a single parent, like me, my husband has already passed on.
Doug Vogel: Yes.
Norma Stanley: You know what do you do in a situation like that? You know, I’m in my early 60s already and I want to make sure that Sierra has whatever she needs.
Nadine Vogel: You look marvelous darling.
Doug Vogel: Sure, yeah, I mean you know, certainly a survivorship can fit nicely, and it can work in if there's a couple um you know to kind of create that bigger bang for the buck, but in your situation, and in some other situations, depending upon what the dynamics are it might make sense to do a single life policy like you don't have your husband, so you can do a permanent life insurance policy on your own life, so that when you pass away it's going to guarantee that this estates going to be there to spill over into the trust, so what it does, is it mitigates the risk Norma. So that you know if you live too long, or you get sick and you have to spend down your assets right that, no matter what else happens there's a constant funding mechanism that when you are not there, no matter what your estate looks like. This is going to immediately spill over into the trust, so you know what that number is that something that you know takes planning and refining and you know you have to look at all the other, you know the other variables and stuff and have the ability to plan.
Nadine Vogel: I have a question really on Norma’s behalf. So, I heard that if Norma had like a brother, a sister, a sibling someone else that was helping her care for Sierra, that they could actually get that kind of policy where it could be her and her brother that got insured, because after she was gone like say he would be taking care of Sierra.
Doug Vogel: You know what that’s, actually I’m glad you brought that up because that's something to consider. And again, that's where we would sit down and kind of explore a little bit more of your dynamic and who's involved in stuff but yeah, I’ve done that, before where there's been siblings that the husband's passed away and, ultimately, you know, there might be a sibling that we can use as a surrogate. It doesn't have to be the parents Norma it can be brother and sister; it could be significant other and significant other you don't even have to be the same sex. You know so as long as there's an insurable interest and it makes sense in the overall strategy that might be a way to do that as well, so yeah thanks. That was great input there.
Norma Stanley: That was great input there.
Nadine Vogel: And we only have unfortunately a few minutes left and something that is near and dear to my heard, for when it comes to this topic that Doug I would love, if you can address is this concept called a letter of intent or we call it a book of intent.
Doug Vogel: Right.
Nadine Vogel: You know it's not a legal document it's not a financial product but it's to me it's so important.
Doug Vogel: Yes.
Nadine Vogel: So, could you talk about that for a couple minutes.
Doug Vogel: Sure, sure absolutely yeah, I mean basically what we're doing here is life care planning, you know that's another definition of kind of you know what we're addressing here and part of that is you know the day-to-day things the continuity, so that when you pass away whoever is going to be stepping into your shoes as information so that they can pick up the ball and provide that ongoing immediate care. So a letter of intent is basically a letter of instruction and Nadines right, it is very, very important in the overall plan, just as important as the special needs trust for a different reason because this gives your plan information to those future caregivers it's something that you put together and basically it's broken down into two areas, the first part is kind of like the factual stuff. And the second part is the intense stuff so typically when I help families put this together, I have them create a narrative to kind of open it up and do sort of an overview of you know their child's history when they were diagnosed was it at birth, for example, if they had down since have down syndrome, or was it diagnosed at a certain age, maybe autism is diagnosed typically when they're younger or was it the result of an accident or injury. And then we kind of do a chronological overview of you know what's gone on in their life milestones met not met. You know, education, different things, and then you close it up in the present tense and you describe today as you're drafting this. You know what your child can do independently somewhat independently, maybe assisted for a child their age or an adult their age right, because if you haven't done this and now, you're starting to do planning and your child's 30. Right, you're doing it at that age and then it's broken down into factual stuff right life goes on stuff if you're not here anymore somebody needs to know who your daughter's doctors are. Name, address phone number email, you know if she's still in school where does she go to school, and she industry because she out of district, the special services contact, how does she communicate is she verbal nonverbal does she have nursing. You know, does she take medications you know Community all those things.
Norma Stanley: I have a notebook, that’s it. But yeah, it's important. Burial, you know I mean I don't want anybody to have to worry, I mean I have insurance, but you know just the details of it. You know what I want, if God forbid anything happens to me and Sierra right all that is covered already so that you know that you just had open up the notebook.
Doug Vogel: And that's the other part of the letter of intent is you get to talk about your vision for the future right what it is that you want, but we always in the back of our mind wanted her to be as independent as possible and that's what we've strived to do all these years and, as you know, she is independent, she lives alone in an apartment and with a service dog, but had we passed away years ago you know, we wanted the people who were going to be stepping into our shoes to know that that was important to us. So, you got to write you can talk about your values, religion, you can talk about quality of Life living arrangements so that's what a letter of intent allows you to refine a willing to trust are important for all the reasons we talked about but, but if it doesn't provide that information to provide that level of care and support and advocacy.
Nadine Vogel: So, the last thing I wanted to touch on I’m going to come back to you Norma is you know the poor planning. Poor planning comes in a lot of different ways, right here, we don't plan right or your experience of maybe not having the right experts so right, I mean that had to be for you normally that would be.
Norma Stanley: Right because I thought I had taken care of it and I happen to be going through, with another financial person and they were like well that's not that's not that's it but that's what I paid them to do right. They weren’t lawyers, they didn't have that same kind of information they didn't understand, so I didn't know that at the time, but now I know it's like oh I’ll share that with everybody like you're saying you know, make sure you have the right people looking at your documents.
Nadine Vogel: Absolutely, it’s the right financial people the right legal people whatever, so I am like I just can’t believe we are out of time.
Norma Stanley: I know it's great information I could go on forever with this.
Nadine Vogel: I know this session has flown by. But, Doug, I want to thank you for joining us today because, again, what is this show this show is that disabled lives matter whether we're talking about a newborn baby we're talking about a young child and adult. But in this particular case we're talking about the parents from day one, acknowledging and taking action to show that we want to have quality of life for our children, because disabled lives matter. So, Doug I want to thank you Norma as always great show I love doing these with you.
Norma Stanley: Me to, I have a great time.
Doug Vogel: You’re welcome.
Nadine Vogel: For our listeners We look forward to seeing y'all and talking to all of you next week bye-bye everybody.
Norma Stanley: Talk to you soon, bye-bye!
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