Currently, there are two financial security schemes for parents with special needs children when they are no longer around to care for them.
The first one is the Special Needs Trust Company (SNTC) Trustee Scheme which provides trust services to beneficiaries who have special needs. However, this requires cash savings with SNTC with a minimum deposit of $5000 and nominal annual fee. For those without much cash outside their CPF, the new Special Needs Savings Scheme (SNSS) managed by CPFB will be a great help.Photo source: The New Paper, 30 Apr 2010, posted in edvantage.com.sg.
SNTC Trustee Scheme
Persons with special needs are defined as those whose prospects of securing, retaining places and advancing in education, training institutions, employment and recreation as equal members of the community are substantially reduced as a result of physical, sensory, intellectual and/or developmental impairments.
Under SNTC Trustee Scheme, the Settlor (parent who sets up the trust for his special needs child) meets SNTC’s case manager to develop a care plan, and this will be reflected in the Letter of Intent, to consider the financial and care needs of the intended Beneficiary under the SNTC Trusteeship Scheme. These include various aspects of the well-being of the Beneficiary such as accommodation, daily living needs (food, clothing, transport etc), educational needs, employment and training needs, medical and dental needs, professional support needs and other areas of concern.
The Letter of Intent is attached to the Trust Deed so that SNTC will administer the trust funds according to the wishes of the Settlor, upon activation of the trust. The Settlor will need to appoint a guardian or deputy (usually a sibling, close friend or relative of the Beneficiary) to review the Letter of Intent with SNTC’s case manager upon activation of the trust. Once the trust is set-up , it is irrevocable but you may review the Letter of Intent with the SNTC case manager and this will up updated in the Trust Deed.
CPFB Special Needs Savings Scheme (SNSS)
SNSS encourages parents of children with special needs to save up for their long-term care needs. Under this scheme, parents can nominate their children to receive monthly disbursements from the parent’s CPF savings after the parents’ demise. There are no administration fees and there is no minimum balance to sign up. To be eligible for the scheme, the nominating parent and the person with disabilities have to be Singaporeans/Singapore Permanent Residents at the time of application. The person with disabilities has to:
(i) Require assistance in at least 1 Activity of Daily Living (ADL)*; OR
(ii) Have attended or is attending a Special Education (SPED) school.
*The six ADLs are – washing, dressing, feeding, toileting, mobility, and transferring.
Parents can decide the amount of monthly disbursement, with a minimum amount $250 for each recipient. However, if the savings at death are not enough to provide the payout for 12 months, the entire CPF balance will be paid as a lump sum.
The money in these special CPF accounts for disbursement will earn the same interest rate as the normal CPF accounts. SNSS will be implemented early 2012. Parents may approach The Centre for Enabled Living for more information.