At age 18, your children are now legal adults, and have the legal right to control their lives. If anything serious happens to them, such as a sickness or disability, your power to act on their behalf or get access to financial and medical information will be severely hampered, if not become impossible, without a court order.
Therefore, like all adults, it is important for your children to have a basic set of estate documents in place, both medical and financial. These include:
- Health Care Proxy with HIPAA Release
The Health Care Proxy allows you to speak with physicians and other medical professionals, and to make medical decisions for your children. Otherwise, you may need to hire an attorney to petition to have you appointed as their legal guardian by a court.
A health care proxy that includes a Health Insurance Portability and Accountability Act (HIPAA) release would also give you (and others your children may designate) access to your children’s health care records, regardless of whether or not they are unable to make their own medical decisions. Under HIPAA, once we turn 18, our health records are now between our healthcare providers and us. Having the HIPAA release in place allows you to receive critically-needed information about your children’s health condition.
- Durable Power of Attorney
Once your children turn 18, their finances are also private. If your children become incapacitated, a durable power of attorney designating you or another trusted person to make financial decisions will allow you to access bank accounts, make sure bills are being paid, and manage overall finances. Without this document, you may need to seek the court’s appointment as conservator.
A power of attorney can also be helpful when dealing with issues that may arise when your children are away at college or traveling. For example, if your son is traveling and an issue comes up where he cannot access his accounts, a durable power of attorney would give you or another trusted person the authority to manage the issue.
The difference between a durable power of attorney and a regular power of attorney is that, unless the power is “durable,” it will lapse if the grantor of the power becomes incapacitated. Therefore, in this instance, it’s important that the power be durable.
A will is important because, in the catastrophic event that any of your children predecease you without one, their assets may have to be probated and will pass according to state law, which in most states would be to the parents. This could cause a disruption to your current estate plan, especially related to reducing your estate for estate tax or asset protection purposes. In addition, your children may intend to leave some tangible property and financial assets to other family members or to charity.
Ensuring that your children have all three components of an estate plan can prevent you, as a parent, from having to go to court to obtain legal authority to make time-sensitive medical or financial decisions for them. If you have children (or grandchildren) who are approaching adulthood, talk to your attorney about executing these three crucial documents.