It is that time of year when students are heading back to school, and this includes many young adults who are heading out to college and away from home. The two estate planning documents every young adult needs to have in place are: (1) a health care power of attorney; and, (2) a financial power of attorney.
Even though most parents feel that they are responsible for their college-age children, the law does not see it that way because the”children” are now adults. In other words, once your children are 18, from a legal standpoint, you are not able to represent them, make decisions for them or have access to their financial or health information.
Planning for our death or incapacity is something that we put on our “to do” list and don’t really want to think about. The general misconception is that estate planning is for the elderly, people with kids or dependents, and/or people with “lots of assets”. We tend to forget that estate planning is necessary for every adult, including young adults, because without proper estate planning we are giving up control over what happens to us in case of incapacity.
College-age students may not have dependents or assets but, for everyone’s peace of mind, an estate plan that gives authority to their parents to make financial and health decisions for them is highly advisable.
For example, if a college student gets hurt and ends up in the hospital, as the parent of an adult child you have no legal right to access their medical records and cannot make medical decisions for them (even if the student is unable to make such decisions) unless you have the proper estate planning/ legal documents in place or go to court to get the authority. The risk is real. Each year a quarter million Americans between the ages of 18 and 25 are hospitalized due to nonlethal injuries.
Some college students may not want their parents to have access to their grades or have complete control over their finances. In these cases, the powers of attorney can be drafted to limit the powers of the agent(s) parent(s), and/or also limit when the parents(s) can exercise those powers. A springing power of attorney for financial decisions goes into effect only in case the student is not able to make decisions for him or herself, i.e. in case of incapacity.
Going off to college is an exciting and new phase in a young adult’s life and in the life of their parents. As part of the planning process for college, parents and their college students should consult with an estate planning attorney about having the proper estate planning documents in place. This is one item that should not be on left on anyone’s “to do” list.
Gita K. Nassiri | Attorney at Law/ CPA
