Understanding the situation
A disabled family member may need coordinated long-term financial and personal support. Before implementing a change, identify whose finances or responsibilities could be affected. Another factor is that eligibility for the Disability Tax Credit can affect access to an RDSP. Check which rules are national and which are provincial. Financial account conditions and legal authority can differ across situations. If there is uncertainty, compare a cautious scenario with a more optimistic one and identify which assumptions make the biggest difference.
Practical considerations
Eligibility for the Disability Tax Credit can affect access to an RDSP. Different assumptions may lead to different outcomes. This is especially important when provincial assistance rules may interact with gifts and trusts. If a calculation is central to the choice, request the assumptions in writing. A range of outcomes is often more informative than a single precise forecast. Keep the review centred on the household goal rather than a particular product or sales presentation.
Financial effects over time
Provincial assistance rules may interact with gifts and trusts. The useful question is whether the relevant records and assumptions support that conclusion. It also helps to account for the related consideration that plans should identify caregivers, legal authority and a sustainable funding approach. One useful comparison is what happens if nothing changes for a year. That baseline can reveal costs or risks that an appealing new strategy does not address. It helps to decide in advance what information would cause you to change your mind.
Steps to prepare
Plans should identify caregivers, legal authority and a sustainable funding approach. An adviser or other professional should be able to explain how this factor changes the options. It is also relevant that a disabled family member may need coordinated long-term financial and personal support. Ask for the limitations of a proposed approach as well as the advantages. A convincing answer should identify circumstances under which the option would be unsuitable. Any suggested solution should be explained in clear terms, including the possible downside.
Questions for your discussion
- What support costs may continue for decades?
- Which benefits could be affected by gifts or inheritance?
- Who will coordinate care and finances?
The value of research is knowing which questions remain unanswered before any commitment.
For questions about this article, contact support@assanteadvisors.com.