People + Money = Options

Posted by Haddad Nadworny on Fri, May 01, 2020 @ 02:59 PM

The Special Needs Financial Planning Team at Affinia Financial Group John Nadworny, CFP, CTFA | Cynthia Haddad, CFP, ChSNC | Alexandria Nadworny,  CFP, CTFA

Who are Your People? Please join us 🎧to find out!

your team

Tune in on Friday, May 8 @ noon for our mini-webinar, The People.  In this webinar we will lay out a step-by-step approach to identify and empower the people who will care for your child when you are no longer able to do so. Topics will include:

  • Where to begin
  • Formal and Informal roles
  • Who is on your team: Family, Community, Professionals

Join us! RSVP to Alex Nadworny @

People + Money = Options 

While physical distancing at home, focused upon keeping ourselves and our families safe and healthy, it is easy to feel vulnerable. Although the vast majority of us will come through this pandemic without damage to our health, it is time to pause, think about what is important to us and take action. 

What are the options you would want your family to have if something were to happen to you?

What decisions would provide the best situation for each family member, including your child with special needs, and for your whole family collectively?

Many times, these complicated questions do not have clear-cut answers but that should not deter you from getting started. Along the same lines, here are two tips to keep in mind as you begin to think about your plans for the future:

  • Accept the assumption that nothing, including your planning, is ever perfect and should be etched in stone.

  • Know that revisions to your planning can be made, and in fact should be made, over time.

While personal circumstances are likely to change, it is important to get started; a primary reason families fail to have a plan in place is procrastination.

A To- Do List to get started.

For many parents, their first priority is to be sure their child will be cared for when they are no longer able to do so themselves. There is no question that a comprehensive estate plan, drafted by an attorney specializing in estate planning, is the best way to ensure your wishes are completed.  However, there can be no effective estate plan without two critical pieces in place: the people and the money. 

Here’s your to-do list to get started or if you have completed your estate planning, to review. Download a copy of this list here

To do list


Please call us to review your options for life insurance or to discuss your beneficiary designations; we can help. We offer a complimentary phone consultation to discuss your circumstances and planning needs. 

And don't forget to tune in for Friday's webinar! RSVP to Alex

This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.

Financial planning and investment advice offered through Affinia Financial Group, LLC, a registered investment advisor. Securities offered through LPL Financial, member FINRA/SIPC. Special Needs Financial Planning LLC, Affinia Financial Group, LLC and LPL Financial are separate entities.



Tags: Special Needs Financial Planning, Life Insurance, special needs Letter of Intent, planning for a future after parents are gone

Tips on Using Second to Die Life Insurance and Special Needs Trusts

Posted by Haddad Nadworny on Sat, Aug 05, 2017 @ 08:22 AM

The Special Needs Financial Planning Team  Cynthia Haddad, CFP | John  Nadworny, CFP | Alexandria Nadworny, CFP

nature-people-girl-forest-12165.jpgVery often, the use of estate planning tools (especially wills and special needs trusts) coordinated with some form of life insurance (second to die insurance or individual life insurance) provides a simple and easy to implement solution to filling the legal and financial gaps that will arise upon the death of one or both parents.   

An interview with our own Cynthia Haddad by Next Avenue, offers tips about special needs planning and specifically about second to die life insurance. 

Tips on Last-to-Die Policies from Next Avenue:

Haddad offers some pointers on what to look for when funding a second-to-die insurance policy:

  1. Parents should make sure their own policies and retirement planning are in good order. “Put on your own oxygen mask first,” she says. “You have to take care of Mom and Dad first.”
  2. Make sure ownership of the assets and beneficiary are properly allocated. She recommends naming a contingency beneficiary to the trust so that any leftover funds would go to that designee.
  3. If the adult child is living at home and paying a “fair share” rent to the parents (perhaps from SSI income), this money can potentially be used to pay for the last-to-die policy since the parents are acting as de facto landlords. “They have that money to use however they want,” says Haddad. “It could be used toward the premium for second-to-die life insurance.”
  4. Be sure to factor in the cost of the annual premium as part of your retirement planning. “You can handle it now,” she says, “but maybe not when you’re retired. Watch what you’re doing.”
  5. Buy what you can afford. If money is no object, Haddad advises looking at the child’s lifestyle — where he will live, what kind of caregiving needs he might have, where he will work — and running a financial accounting out for his potential lifetime. If the trust includes owning a house, account for potential upkeep. Remember: any leftover trust funds, assuming it’s a third party trust, could potentially go to the other siblings if they are named as contingency beneficiaries. “It can take out of the equation why are Mom and Dad leaving more money to Johnny,” she says. “Everybody else still gets their inheritance.”
  6. Build a team to carry on. “Mom and Dad do a lot,” Haddad says. “When they’re gone, it takes more than just one or two people to replace them. Who’s handling all that day-to-day stuff?” she says, noting that sometimes siblings don’t want to be trustees. “Make sure there is enough to pay for professional trustees, professional guardians.”
  7. Work with financial planning and insurance specialists. “You don’t go to your primary care physician for a cancer issue. You need to go to cancer specialist,” Haddad says. “You’re ratcheting up your need for special advisers. You want to know you’re working with people who understand your child’s unique needs more than you do. It’s a different world you’re entering in.”


Tags: Life Insurance

Life Insurance and Special Needs Planning

Posted by Patricia Manko on Wed, May 15, 2013 @ 07:23 PM

LIFE INSURANCEAfter legal and estate planning, risk management – or insurance protection – is perhaps the second most important building block to financial security.  In an instant, an unforeseen catastrophe or illness could change your financial picture for life. Not only is it important to protect the family's lifestyle and income needs in the event of a premature death or disability of a parent, but it is also critical to plan for the supplemental lifetime needs of the child with special needs.

Special Considerations for Life Insurance in Special Needs Planning

The use of life insurance in special needs planning is somewhat different than in traditional planning . It is critical to plan for the financial problem of one of the most catastrophic events in life; a parent’s death.

In planning for a traditional family, often the largest amount of life insurance protection is purchased for the wage-earning parent.  Following this same strategy is one of the most common errors a family with special needs tends to make.  One cannot assume there is no financial value lost in the event of death of the primary caregiving parent.  Although it is difficult to place a financial value on the parent that does not work outside of the home, or provide the majority of the income to the family, it is critical to account for this value.  This often means that you have to look at each parent to determine the human life value.  This is ultimately converted to a dollar value to determine the life insurance protection needed.  

Income Replacement:

In the traditional planning model, the amount of life insurance needed is often simplified to be a function of the annual income. For example, to determine the life insurance need of a wage earner, a simple technique is to multiply your annual earnings by 5 or 10 times or the number of years you want to ensure that income for your family is continued.  This means tht if you earn $100,000 per year, you should have from $500,000 to $1,000,000 of life insurance protection.  A more detailed approach would be to complete a capital needs analysis. This is the analysis that most life insurance professionals and financial planners use.  This calculation involves determining the present value of money needed to pay for short-mid-and long-term goals a family identiifies. For families with special needs, insurance coverage requirements often extend well beyond the traditional family's timeline fo having enough money to support children through their school years.  Special needs planning requires planning for two generations, anticipating a possible need to support the child with disabilities beyond the school years and throughout his or her life.

In special needs planning, the first step in determining life insurance needs is to determine the loss of income to the household with the death of a parent. Next it is important to identify the expenses that will continue upon the death of that parent, particularly money needed to address future family goals. Looking at income alone can be misleading because variations in saving and spending affect planning.  In the event that a family spends a larger percentage of their monthly income, they have two options:1. to insure for this larger amount to maintain the family lifestyle, or anticipate lifestyle changes required by the family due to a decrease in income after the death of a parent.  For families who are diligent at saving for their future – for retirement, education, supplemental needs, etc. – a loss of income may prevent the ability to maintain this saving pattern.  Families must address issues of both current spending to maintain their lifestyle and their savings and investments for the future. 

The other common error in purchasing life insurance is buying only term life insurance.  Term insurance is life insurance that is designed to last for a predetermined number of years, such as 5,10, 20 or possibly 30 years if applied for at an early age. Term insurance works in the event that the need for protection is for only a temporary period of time. In special needs planning, the “need” is not temporary – it is permanent. As we have discussed, the need to address that second generation of financial issues comes into play once again.  There may be a need for permanent life insurance protection, rather than term life insurance that only lasts until the children have grown in 20 years.  A recommended strategy is to acquire a combination of both term and permanent insurance.

Contact us with questions or for help  determining your family's insurance needs.







Tags: Special Needs Financial Planning, Life Insurance

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