You’re Forgetting Someone Important

Special needs planning when your child has siblings

(This guest post was written by Cassidy Parker Knight, the adult daughter of one of our attorneys. )

If you’re a parent of a child with special needs, you’ve probably spent some time wondering about what your child’s future will look like once you’re not around to take care of them anymore – maybe a lot of time, and maybe more worrying than wondering. Where will they live? What money will support them? Who will take care of them?

“the reason you’re worried is because you won’t be around, but the reason your other kids worry is because they will be around.” 

Cassidy and her big brother Dylan

            You may not realize it, but if you have other kids who aren’t disabled, they’ve thought about it too. Of course, the reason you’re worried is because you won’t be around, but the reason your other kids worry is because they will be around. They may worry that you plan on your disabled child living with them and they don’t want that, or they may worry that any financial burden will fall to them, and wonder what happens if they can’t afford it. If they’re older, they may worry that there is no plan, and that it will be all on them to figure out after you’re gone.

            I think I was in middle school the first time the thought occurred to me that someday, my parents would be gone and it would just be me left to care for my brothers. It’s overwhelming, at just 12, to start worrying not only about your parents dying someday, but all the lifelong responsibilities that will come with those deaths. And the older your kids get, the more aware they’ll become of what those responsibilities entail. I’ve spoken to siblings who made decisions about college, their profession, where they live, and whether they start families all based on their future responsibilities for their siblings.

            For a parent, it must be overwhelming to think about planning a future for your child that you won’t be a part of. It can be easy to think that you’re shielding your other kids from that worry, but in reality, the opposite is true. Your disabled child’s adult siblings are your biggest allies, and filling them in on any estate planning you’ve done or wishes for the future you have will also be a kindness to them. It can also help you both to spot problems with the plan while you still have a chance to make your voice heard—for instance, if you want your child with special needs to live with your abled child and you learn that your abled child doesn’t want that, it’s probably important to you that you have a say in the alternative.

            In all the conversations I’ve had with other siblings though, the most common worry I hear about the future is not about the responsibility or having to take care of their sibling—it’s about the uncertainty. If you have the estate planning under control, fill your child in, especially if they’re not really a child anymore. Let them know what roles they should and shouldn’t expect to play, and give them an opportunity to tell you whether that fits the role they want to play. Most importantly though, there should be a plan. If that part hasn’t been done yet, starting that process would really be the greatest kindness you could do all of your children.

How should Batman’s parents have done their estate plan?

One of our best known vigilante crime fighters, Batman, was orphaned at the age of 8 when his parents were murdered.  He swore to dedicate his life to fighting crimes like that which killed his parents, and by the time we see him in adulthood he has spent millions of his billion dollar fortune designing and building crime fighting gadgets galore and an elaborate secret cave for operations headquarters. Let’s see how that might have come about.

What issues do the Waynes have?

They own businesses, so they need succession planning to make sure the company can continue running.

They have a minor son, so they need to plan for his care until he grows up and for how and when they will give him the money he will inherit.

What did they own?

We don’t actually know if the elder Waynes left a will or any other estate planning, but I would guess it was incomplete, at best, as I’ll explain below.  We know that they had enormous wealth in the form of a number of profitable companies falling under the umbrella of Wayne Industries. There was money and potentially company ownership from Mrs. Wayne in addition to Wayne Industries, but it is less clear how that was owned and managed. This means that in addition to planning for the distribution of their personal wealth, Bruce’s parents also had to prepare succession planning for their businesses and business interests. 

And of course, the most important piece of their planning, and where I suspect they failed, was in the management and distribution of their wealth and businesses to their son.

Businesses

The Waynes appear to have had at least some succession planning in place for their businesses, as we know that the companies weathered the immediate period after their death and that they were thriving many years later when Bruce was flying about the town on his bat wings.  This meant that the companies must have had either a corporate structure or a well written set of bylaws or partnership agreement for an LLC or partnership structure. In a corporation, the company itself has the ability to replace leadership, adjust to circumstances and operate independently of whether their officers or any of their shareholders died unexpectedly. The passing of shares is generally controlled by specifically created and adopted company policies, or controlled by state law. 

In the case of an LLC or partnership, where there are typically fewer people involved in the running of the company, a plan setting out who owns shares versus who has the ability to run the company is important to prevent infighting or take over by inexperienced leaders. The Waynes do appear to have prevented the demise of their companies through advance planning of some sort. While Bruce, as their only heir (if they did not have a will), would have inherited their interests in the companies, as an 8 year old he would have been unable to run them, requiring the parents to prepare for the possibility of their early death by having other adults ready to step into company leadership roles. Written plans, along with properly adopted bylaws and policies within the company, would have allowed for this.

Bruce

We know that Bruce inherited all or the majority of his parents’ estates due to the seemingly bottomless pit of money he has access to in later life.  Most people do leave all or most of their estate to any children they have before considering gifts to other relatives or friends, and the Waynes seem to have followed this pattern. If they had no will at all, then in most states everything they owned would go to their child.  But as an 8 year old, Bruce would not have been able to exercise control of any money or property at that time. The best way to provide for minor children is through the creation of a trust that will hold their inheritance until they are older and allow an appropriate person or trust company to manage the inheritance until the child can take over.  If the Waynes did not have a will that created a trust for Bruce, a court would have  created one for him.  In that situation, when Bruce reached the age of majority, which today is usually age 18 but may have been 21 if we are talking about the Golden Age Batman, he would have been give all the fortune outright, having complete control over management and spending of the money as soon as he turned either 18 or 21.

If the Waynes had created a trust in advance, they would have been able to delay Bruce’s access to the entire sum of money, and they would have been able to allow time for him to learn how to handle such a large sum responsibly.  Some parents direct the trustee to pay for higher education or down payment on a home or even a sum toward starting a business, but access to full control by the child is delayed until an older age or a life milestone, such as obtaining a college degree.  If the amount of the inheritance is very large, it may be released to the child in stages, so that some money comes under their control while the rest stays in trust and protected from the missteps of youth.

Basically, you can set the trust up to do what you expect you would do for your child if you’d been alive and they asked for money. 

I suspect that Bruce’s parents did not have a trust set up for him because it is hard to imagine that the ways in which he used his money would have been green lighted for loans or gifts by his parents.  “Hey Mom and Dad, I want to spend a big chunk of your hard earned money to dig a giant hole under our tower (I’ll pay an engineer to make sure it doesn’t fall down) and then try to invent super high tech comic book toys so I can confront highly dangerous and violent criminals all alone.  Is that ok?”  

I like to think Mom and Dad would, at the very least, have required Bruce to provide a proof of concept and marketability study before backing this particular hobby.  Which is why I’m pretty sure young Bruce had sole control over his money at about the same age many young men buy their first car and then roll it into a ditch.

If you want to keep your young super heroes safe and solvent and protected from their own passions, a trust for minor’s is definitely the way to go.