Take These Three Steps When Your Child Turns 18

If your child has reached the teenage years, you may already feel as though you are losing control of her life. This is legally true once your child reaches the age of 18 because then the state considers your child to be an adult with the legal right to govern his or her own life.

Up until your child reaches 18, you are absolutely entitled to access your child’s medical records and to make decisions regarding the course of his treatment. And, your child’s financial affairs are your financial affairs. This changes once your child reaches the age of 18 because your now-adult child is legally entitled to his privacy and you no longer have the same level of access to or authority over his financial, educational and medical information. As long as all is well, this can be fine. However, it’s important to plan for the unexpected and for your child to set up an estate plan that at least includes the following three crucial components:

 

1. Patient Advocate Designation with HIPAA Release

Under the Health Insurance Portability and Accountability Act, or HIPAA, once your child turns 18, the child’s health records are now between the child and his or her health care provider. The HIPAA laws prevent you from even getting medical updates in the event your child is unable to communicate his or her wishes to have you involved. Without a HIPAA release, you may have many obstacles before receiving critically needed information, including whether your adult child has even been admitted to a particular medical facility.

Should your child suffer a medical crisis resulting in the child’s inability to communicate for him or herself, doctors and other medical professionals may refuse to speak with you and allow you to make medical decisions for your child. You may be forced to hire an attorney to petition to have you appointed as your child’s legal guardian by a court. At this time of crisis, your primary concern is to ensure your child is taken care of and you do not need the additional burden of court proceedings and associated legal costs. A health care proxy (known in Michigan as a “Patient Advocate Designation”) with a HIPAA release would enable your child to designate you or another trusted person to make medical decisions in the event your child is unable to convey his or her wishes.

 

2. Durable Power of Attorney

Like medical information, your 18-year-old child’s finances are also private.  If your child becomes incapacitated, without a durable power of attorney you cannot access the child’s bank accounts or credit cards to make sure bills are being paid. If you needed to access financial accounts in order to manage or resolve any problem, you may be forced to seek the court’s appointment as conservator of your child.

Absent a crisis, a power of attorney can also be helpful in issues that may arise when your child is 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. An alternative may be to encourage your child to consider a joint account with you.  However, this is rarely recommended because of the unintended consequences for taxes, financial aid applications, creditor issues, etc.

 

3. Will and/or Beneficiary Designations

Your child owns any funds given to him or her as a minor or that he or she may have earned. In the catastrophic event that your child predeceases you, these assets may have to be probated and will pass to your child’s heirs at law, which in most states would be the parents. If your child has accounts in his or her name, make sure there is a “Pay-on-death” beneficiary listed on the account, in order to transfer this account without probate.

While a will may be less important than the health care proxy, HIPAA release or durable power of attorney, ensuring that your child has 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 your child.

 

4. Consent to Access Educational Records.

Under the Family Educational Rights and Privacy Act (FERPA), schools must generally have written permission from the parent or eligible student who is 18 or older, in order to release any information from a student’s education record. This is often surprising to parents who may be paying the college tuition bill and find they aren’t entitled to access information about their child’s records. Make sure to have this provision in the Power of Attorney and also ask the college if there are consent forms that can be signed in advance.

If you have a child (or grandchild) who is approaching adulthood, talk to your elder law attorney about having the child execute these  crucial documents.

If you have specific questions about your situation or would like to learn more, reach out to the team at WBH here.

Read more articles:

What Is Hospice Care at Home?

Hospice care is a type of health care that patients with terminally ill conditions rely on at the end of their lives. This type of care focuses on pain management and emotional, spiritual, and familial support for patients nearing the end of their lives. There are...

Social Security Recipients to Get Another Increase in 2023

The Social Security Administration has announced that its beneficiaries will see a significant increase – totaling nearly 9 percent – in their monthly Social Security checks come January 2023. This cost-of-living adjustment (COLA) is the largest boost to Social...

Start 2023 Prepared: Reassess What Matters Most

If we have learned anything these past few years, it’s that life is fleeting. Amid such uncertain times, many of us have realized what – and who – truly means the most to us. Estate planning allows you to reflect on your family, your priorities, and what actions you...

10 Ways to Maximize Your Social Security Retirement Benefits

Social Security wasn’t meant to be a primary source of income for retirees when it was first created in 1935. It sought to provide an umbrella of protection for people who couldn’t save enough for retirement. Most Americans didn’t think much about Social Security,...

What Are Veterans Death Benefits?

Although death benefits are available to veterans, as well as their families and veterans who did not engage in combat, less than half of those who are eligible for death benefits use them, according to the American Association of Retired People. Available veterans...

Should You Prepare a Medicaid Application Yourself?

Navigating the Medicaid application process can be complicated, especially if you are applying for long-term care benefits. Hiring an attorney to help you through the process can be extremely helpful. Whether you should prepare and file a Medicaid application by...

Inherited Retirement Accounts: Minimizing Tax Consequences

The Setting Every Community Up for Retirement Enhancement (SECURE) Act, which went into effect in 2020, changed how beneficiaries of inherited retirement accounts must withdraw these funds. The Act’s passage made it more difficult for individuals to pass their...

Using Estate Planning to Prepare for Medicaid

Long-term care involves not only a loss of personal autonomy; it also comes at a tremendous financial price. Proper planning can help your family prepare for the financial toll and protect assets for future generations.  Long-term care can be very expensive,...

Using a QTIP Trust in Estate Planning

Estate planning is crucial when managing valuable assets and ensuring the smooth transfer of wealth to future generations. There are various types of estate planning tools available, some of which may be more useful depending on your circumstances. For some, a...

How Do You Choose the Right Person for Your Power of Attorney?

A Power of Attorney is a document that authorizes someone to represent and act on your behalf should you not be in a position to do it. The person you name to act on your behalf is known as the “agent.”  Your agent may need to sign contracts, handle investments, sell...