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Families of children with special needs are tireless advocates for their kids. They challenge school districts for equal access, they fight for federal benefits and cutting-edge therapies, and they raise awareness of disabilities through nonprofits.
They also dig deep financially.
Even with health insurance, parents can spend hundreds of thousands of dollars on out-of-pocket fees associated with equipment, medication, and care for their child, depending on the diagnosis. Some disabilities are more costly than others.
Autism Speaks, for example, found that the lifetime cost for a person with autism spectrum disorder can range between $1.4 million and $2.4 million, depending on whether the person also has an intellectual disability. In addition to medical costs, intensive behavioral interventions for children with autism can cost $50,000 or more per child per year1
“For families, an autism diagnosis can also mean a lifetime of absorbing many of the financial and care-giving burdens associated with the disability, especially in adulthood when the societal support diminishes,” said Paul Shattuck and Anne Roux of Drexel University, in a joint editorial published in the “JAMA Pediatrics” medical journal.2
Money and work demands
Some parents turn to second mortgages, loans, or even credit cards to ensure their child is never denied a medication or service that they need. And many quit work or change careers to make themselves more available for hands-on care, which affects their household income.
Kelly Piacenti, head of SpecialCare at MassMutual and a mother of four, including a son with special needs for 19 years, said her family was fortunate to have had robust health insurance all along.
“But even with that, there were still substantial sums that we paid out of pocket,” she said, noting at least 10 percent of their household net income was spent on copays, medicine, and equipment not covered by insurance for their son, Nicky.
Piacenti said she revamped her career to be more available to her son and better advocate for his care.
“My husband’s position and direction was changed because of Nicky as well, but he would tell you that it’s not that life knocks you down that matters,” she said. “It’s that you get up and deal with it.”
For families with a child with special needs, she said, the importance of careful planning cannot be overstated.
“You are not going to be there forever, but your child may well live beyond your capability of caring for him or her,” said Piacenti. “Be prepared for that by planning ahead.”
Maximize public benefits
Gordon Homes, Jr. , a MassMutual special care financial professional with WestPoint Financial Group in Indianapolis, Indiana, said planning for most families with a child with special needs begins with the legal process of securing (and appealing for if denied) government benefits.
That includes Medicaid health care coverage and Medicaid Waivers, which allow individuals, children, or adults who need additional help to receive that help in their home and community. In some cases, Medicaid Waiver services may enable a consumer to avoid being cared for in an institutional setting.3
Supplemental Security Income, or SSI, can also be a valuable source of monthly benefits to aged, blind, and individuals with a disability who have low income and limited resources. Your child, if younger than age 18, may qualify if he or she has a physical or mental condition that meets Social Security’s definition of disability for children, and if his or her income and resources fall within the eligibility limits. The amount of the SSI payment differs by state. Check with your local Social Security office to find out more.4
Children with special needs of working families with incomes too high to qualify for Medicaid, but too low to afford private health insurance, may also be eligible for the Children’s Health Insurance Program (CHIP). The program, available in all 50 states and the District of Columbia, provides coverage for prescription drugs, vision, hearing, and mental health services. Your state Medicaid agency can provide more information.
Depending on your child’s age and disability, Medicare may also provide benefits. The federal health insurance program is designed to provide coverage for people age 65 or older. A child who has a disability whose parent has qualified for Medicare will become eligible for Medicare after two years. Two exceptions to the rule exist, however. Your adult child with a disability can potentially get Medicare immediately if he or she has a chronic renal disease and needs a kidney transplant or maintenance dialysis, or has Lou Gehrig’s disease (amyotrophic lateral sclerosis).5
Estate planning
Next, Homes noted, parents should consider creating a financial strategy to provide for their loved one with special needs.
“In this day and age, financial success is often equated with not running out of money before you die, but that doesn’t work for parents with a child whose quality of life is in large measure determined by the legacy they leave,” said Homes.
Apart from the traditional estate planning documents — including a will, durable power of attorney, medical power of attorney, health care directive, and beneficiary designations for their retirement assets and insurance plans — many families with a child with a disability create a special needs trust. (Learn more: Special needs trust: What are they and who needs them? )
Such trusts allow a individual with a disability to use assets within the trust over the course of their lifetime, without compromising their eligibility for need-based government benefits.
“Special needs trusts let the government do as much of the heavy lifting as possible, but are there to provide for whatever public benefits can’t or won’t cover,” said Homes, whose 25-year-old son has special needs.
It’s not enough to merely create a trust, however. You must also ensure that it is well funded.
“We tell parents to bring all possible resources to bear for their child while the parents are still here and then to make certain that plans are in place for when the parents are no longer here,” said Homes.
Apart from personal savings, he said many families name their special needs trust as beneficiary to their life insurance policy. “That can be a practical and affordable way to ensure that your child is provided for long term, and to ensure that their needs do not represent a financial burden to their siblings or other family members,” said Homes. (Related: How to find family balance with a special needs child)
It’s worth noting, too, that individuals with a disability who are old enough and eager to work can now also potentially open an ABLE account, which stands for Achieving a Better Life Experience.
Such tax-advantaged savings accounts, which became available in 2017, enable eligible individuals with a disability to save up to $$19,000 (in 2025) annually for qualified expenses, including: housing, education, personal assistance services, health care, employment training, assistive technology, transportation, financial management, and administrative services and other expenses related to their disability, without jeopardizing their public benefits.
Working individuals can contribute an additional $15,060 (in 2025) annually from wages if they are not participating in a company retirement plan. Any savings they tuck away now can potentially help provide for their care later on. (Learn more: A new tool for the disabled: ABLE accounts )
A financial professional with experience in special needs planning can be a valuable resource in helping families develop a long-term strategy to provide for their child.
For parents who have just embarked on the journey of raising a child with special needs, Piacenti offers some comforting words of advice. “Do not be overwhelmed! Take one thing at a time. You will get through it. Once the initial shock is over, you can start planning long term.”
You might even be surprised at how every challenge is met with reward. “My life since Nicky’s birth has had tremendous difficulties and lots of heartaches, but my family has managed a wonderful life that included Nicky, and we have been enhanced by his presence,” she said.
Since 1851, MassMutual has been focused on helping people secure their future and protect the ones they love. That purpose is why we have thousands of financial professionals to assist you on your journey through insurance, investing, retirement planning, estate management, and more. You can find a MassMutual professional with this tool or you can let us know you’d like to talk to one and we’ll have one of our financial professionals contact you.
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Estate planning tools for special care
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This article was originally published in June 2020. It has been updated.
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1 Autism Speaks, “Financial Resources.”
2 JAMA Pediatrics, “Autism: Moving Toward an Innovation and Investment Mindset,” Aug. 2014.
3 Centers for Medicare & Medicaid Services, “State Medicaid Plans and Waivers,” February 7, 2025.
4 Social Security Administration, “Supplemental Security Income Home Page 2022 Edition," 2022.
5 Social Security Administration, “Benefits For Children With Disabilities,” 2025.
