Planning for Your Child's Future

Wills and Trusts

If you don't have a will, this is the time to have one prepared. Once the child is placed in your home, you'll want to see an attorney to add the child to your will or to any trusts you may have. Mentally or physically disabled children can raise unique legal and financial issues. Think carefully about who will take care of your adopted child should something happen to you.

Beneficiary Designations

Financial planners generally recommend that parents not name their children as direct beneficiaries to their insurance policies, retirement plans, individual retirement accounts, investments, and so on. That's because minors are restricted by state laws in their access to funds. However, your circumstances may call for naming the child as a beneficiary (and almost certainly as a secondary beneficiary). Talk with a financial planner or other specialist to determine the most appropriate actions.

Trusts For Children With Disabilities

If you adopt a child with a physical or emotional disability who might never be self-sufficient, you can arrange for a special-needs trust. This is a trust established by parents for the benefit of their child. Families with adequate income can fund the trust with life insurance, for example. A trust can be useful in allowing family financial support for the child without affecting the child's eligibility for Supplemental Security Income (SSI) from the federal government. This is a highly technical area and an experienced attorney and financial planner should be consulted.

Birth Parent Search

It is natural for an adopted child to be curious about his or her biological parents or siblings. Some adoptees will want to search for their roots or have a reunion with their biological parents or siblings once they reach adulthood. Some states may make the records available to the adopted child when he or she is age 18 or 21. Even then, state laws vary considerably regarding the circumstances under which information can be released. Other states keep the records permanently sealed.

By collecting as much background information as you can during the adoption process, you may be able to satisfactorily answer some of your child's questions until he or she is old enough or able to get further information on his or her own.

© This information is from the Federal Citizen Information Center of the U.S. General Services Administration.