Caring for someone who is navigating mental health challenges or substance use often means balancing support with safeguards. A thoughtful estate plan can make daily life easier, preserve eligibility for benefits, and reduce conflict when decisions are hard. Every family and diagnosis is different, so treat the ideas below as a starting point to discuss with an attorney who can tailor them to your facts. This overview is for general information and planning purposes.
Why planning matters
The most effective plans do four things: keep your loved one safe without removing more independence than necessary, make health and financial decisions workable in real time, protect assets from misuse while still providing support, and preserve public benefits where appropriate.
Start with medical decision-making
Begin by naming someone who can speak with doctors, authorize treatment, and get information if your loved one cannot. In practice, that means a Health Care Power of Attorney paired with a HIPAA release, often with a Living Will to reduce confusion in end-of-life scenarios. Many families add a short “care preferences” page listing medications to avoid, preferred providers, hospital choices, and what to do in a crisis. These tools help clinicians move quickly and keep everyone informed.
Put financial controls in place
A Durable Financial Power of Attorney lets a trusted agent manage rent, utilities, insurance, and banking without handing over unfettered control. Account design matters too. Direct payment of housing and essentials by an agent or trustee can reduce the need for cash and prevent coverage gaps.
Use trusts to support without enabling
When you want to provide support while limiting access to lump sums, a discretionary or spendthrift trust can pay for housing, treatment, transportation, and job coaching, while giving the trustee flexibility to adjust as circumstances change. If your loved one relies on means-tested benefits, a third-party special-needs trust can preserve eligibility while still supplementing care. Trust language works best when it is clear, practical, and focused on stability rather than punishment; rigid “incentive only” formulas often fail in real life.
Coordinate with privacy and benefits rules
Treatment and health information can be subject to heightened privacy requirements, so families should be thoughtful about what is shared, with whom, and under what authority. Separately, if the person receives means-tested benefits such as SSI or Medicaid, planning should account for strict income and resource limits. Reviewing account titles and beneficiary designations helps avoid unintended transfers that could disrupt eligibility, and tools like ABLE accounts may provide a practical way to set aside limited funds in a benefits-friendly manner. Because privacy obligations and benefits eligibility rules are technical and can change, confirm the appropriate approach with counsel and qualified advisors.
Choose the right people
Agents and trustees should be organized, calm in emergencies, and willing to follow the plan as written. In higher-conflict families, co-fiduciaries or a professional trustee can create stability. It also helps to name successors and to make a simple communication plan so the care team knows who leads, who backs up, and how information will be shared.
Fund and align assets
Life insurance, retirement accounts, and transfer-on-death or payable-on-death designations should be coordinated with the trust so dollars arrive in the right place, at the right time, with the proper safeguards. Keep a short asset map in your estate binder and refresh it yearly so fiduciaries can step in without guesswork.
Build for change
Needs can shift over time. A well-built trust allows the trustee to fund treatment, sober housing, counseling, and transportation when risk is high, then expand support as stability returns. Families often find it reassuring to know the plan can respond to relapse without upending everything they have put in place.
Starter documents to discuss with counsel
- Health Care Power of Attorney with HIPAA release, plus a brief crisis plan
- Durable Financial Power of Attorney
- Discretionary or special needs trust with practical distribution standards
Pitfalls to avoid
- Leaving assets outright to the individual
- Omitting HIPAA releases or clear crisis instructions
- Misaligned beneficiary designations that bypass the trust
Getting started
Write a one-page goals memo, list key assets and accounts, and identify who could serve as agent or trustee. Then take the next step — meet with an attorney to translate those goals into documents and funding that fit your family. If you would like help shaping a plan for your specific facts, CPM’s Family Wealth & Estate Planning team can work with you to build a practical, durable plan.
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