“Estate Planning for New Grads” by Attorney Stephanie Blair (Audio)
It seems like just yesterday you were dropping your child off at kindergarten, but the apple of your eye is now 18 years old and considered an adult. You are no longer entitled to have access to or make decisions for them regarding their financial and medical matters, even if you are still footing the bill.
Having a comprehensive group of documents in place signed by your child before they head off to their next stage of life can help you and your newly minted adult as they make this transition. These documents include: a Health Care Power of Attorney, HIPAA Authorization, Living Will, and Financial Power of Attorney.
A Health Care Power of Attorney authorizes you to make healthcare decisions for your child if they are unable to do so themselves. Accidents and sudden illnesses happen to young adults all the time. Your child may find themselves unable to make healthcare decisions where the doctors who are not familiar with your family are making decisions that you or your child may not agree with. Simply because your child is still on your health insurance and you pay the medical bills does not mean that you are entitled to make healthcare decisions for your adult child. However, if you are named under your child’s Health Care Power of Attorney, you are permitted to make healthcare decisions for them if they cannot.
A HIPAA authorization is permission granted by your child under the Health Insurance Portability and Accountability Act which permits healthcare providers to speak to you and anyone else your child chooses to receive information about their health care information. Without this document, the healthcare providers cannot share any health care information regarding your child.
A Living Will allows your child to makes end of life decisions in advance should they be in a condition with no reasonable expectation of recovery as a result of a severe illness or injury. Although your child has been under your roof for 18 years, their preferences for end-of-life decisions may be different than yours. This document allows them to express their wishes in these situations.
A Financial Power of Attorney allows your child to designate you as an agent regarding the handling of financial matters on their behalf whether they are incapacitated or not. You will be able to access their bank accounts, pay their bills, and perhaps sign tax returns. Even if you are regularly giving them money as support, you can no longer manage their money without this document.
Without the proper legal documents in place, you will need to obtain a court order to help your adult child with these matters. However, it is important to keep in mind that since your child is now an adult, it is ultimately their decision who they choose as their health care and financial agent and whether or not they want to execute the documents. Additionally, they can amend or revoke the documents at any time.
Although you may be thinking of these documents only prior to your child’s freshman year of college, these documents can still be put in place even if your child is a sophomore or beyond, taking a gap year, traveling, studying abroad, or joining the military. Whatever life has in store for your child, these comprehensive documents which allow you to provide a helping hand can be an invaluable graduation gift. What better way to provide your adult child support while giving them the room to grow?
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