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Contact: Alexandra Oatman, Marketing and Outreach Manager
aoatman@jlatrust.org, 310-773-9728 ext 7

POOLED SPECIAL NEEDS TRUSTS LIFT UP PEOPLE WITH DISABILITIES

JLA Trust Offers An Affordable And Easy Way For Families Who Have Children With Disabilities To Plan Ahead

LOS ANGELES, September 12, 2022 – When Paul Tate’s grandfather passed, the small inheritance he left should have been a relief for Paul and his parents – but instead, it was a stressor.  “I didn’t know how to protect the money,” his mother, Kristy Tate said.  “Because if it went directly into his account, they’d cut out his disability.”

Paul was adopted at birth, and formally diagnosed with autism and fetal alcohol syndrome at age nine.  Now 30, it seemed clear to the Tates that it was unlikely Paul would ever be able to hold a job.  He would need therapy and support for the rest of his life.  Kristy and her husband had spent years securing state and federal disability payments for their son, but the modest inheritance from his grandparent would disqualify him – he could not have more than $2,000 dollars at a time.

The Problem

Over 54 million Americans have a physical, sensory, or intellectual disability, but as of 2021 only 19.1% of adults with disabilities were employed.  Households that have a family member with a disability are more likely to be below the poverty line than those without them.

SSI’s tiny asset and income rules – disallowing benefits for any person earning or even possessing $2,000 a month – mean that people with disabilities like Paul Tate often find themselves burdened by sums of money inheritances and legal settlements that might otherwise improve their lives.

The answer, in conundrums like the one the Tates found themselves in, is often an irrevocable trust known as a “special needs trust”.  These trusts can provide financial security for private funds without jeopardizing those vital government benefits.  They have primarily been used by the wealthy who use commercial trustees such as banks, law firms and professional fiduciaries. Those institutional trustees typically require a minimum of $1 million cash to open a special needs trust, putting it out of the reach of most families.

Kristy went to lectures and interviewed multiple special needs attorneys, trying to find a way to get a trust set up for her son.  But the prices seemed outrageous to her.  “I couldn’t believe it – the amount they were charging was half of what he got.”

The Solution

Kristy Tate’s answer came from an unexpected place: the Jewish Journal connected her to pooled Special Needs Trust called JLA Trust & Services.  A non-profit organization, they were able to help her set up an affordable 3rd Party Future Funded Special Needs Trust for only $800.  By “joining” a pooled trust – which had an established Master Trust created by an expert local estate attorney, and sharing a trustee rather than paying for their own, beneficiaries can keep their benefits and their inherited funds. Clients like Paul have access to professional trustee services and investment management at below-market costs, along with caring, knowledgeable staff that know and understand clients like him and their needs.

Kristy considers herself lucky to have found them when she did. “I will be adding to the trust, and when I’m no longer here there will be life insurance and so on.”   Establishing a special needs trust early allows her to build it as part of an estate plan, so that when she and her husband are gone, Paul’s benefits will not be interrupted.  It also takes the future responsibility of managing Paul’s financial affairs away from their other child.

JLA Trust & Services

JLA Trust is a community-based non-profit agency that provides pooled special needs trusts and long-term planning counseling services for persons with disabilities in Southern California, ensuring quality of life for all clients.  As of July 2022, they have 151 enrolled beneficiaries like Paul, helping protect over $7.2 million in pooled assets.  The organization was founded in partnership with the Jewish Community Foundation of Los Angeles and the Jewish Federation of Greater Los Angeles.

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