With graduations in full swing and high school seniors preparing to leave home for college, employment, or other adventures, it may be time to consider estate planning documents for your 18 year old. It may not initially make sense for an 18 year old to need an estate plan since most do not have significant assets. However, in most states, an 18 year old is an adult, with legal rights relating to privacy and decision making. As soon as a child turns 18, parents will lose authority to view medical and financial records related to the child, as well as be prevented from making decisions on their child’s behalf.
In order to ease the transition into adulthood, parents and 18 year old “children” should consider two important estate planning documents. The first is an Advance Health Care Directive. This document will allow the adult child to name an agent to make health care decisions for the child in the event the child is unconscious or otherwise unable to communicate. In conjunction with the health care document, the adult child should also execute a HIPAA waiver which will allow the agent to view medical records and discuss current health issues with medical professionals, assisting the young adult with the understanding and management of current health conditions.
The second important document is a Power of Attorney for Finances, which allows the adult child to name the parent as an agent with the authority to discuss the adult child’s finances with financial institutions and assist with the management of other financial tasks, such as rental and landlord issues, obtaining and paying for medical and/or auto insurance, discussing and paying bills, replacing lost credit or atm cards, etc.
Both documents should be designated to be effective immediately upon signature (rather than becoming effective only upon incapacity) so that the designated agents can act at any time. Starting young adults with these basic estate planning documents can provide guidance during the transition to adulthood and allow parents to remain involved on an as needed basis.