You made it! The new adventure of life starts now! Whether your newest adult is going to college, vocational training, the military or getting a full-time job – those of us with adult “children” have a few pieces of advice to help you and your new adult bridge this “firstGAP”.
Before your son or daughter goes to school or off to live on their own:
- Health Insurance. If your newest adult is under the age of 26 parents can still cover the child on their existing health insurance. Be sure your son or daughter has copies of his or her health insurance and prescription cards. Explain how to use them.
- Vehicles and auto insurance. If your student will attend school, the “good student” driver element of your auto insurance is likely still in effect. Your insurance company may require official transcripts at least annually to verify requirements. If your son or daughter will not be attending school, then we recommend that their vehicle be retitled into their names and they obtain their own auto insurance as soon as reasonably possible.
- FERPA release. If your son or daughter will be going to school, before classes begin, go to the registrar’s office on campus to fill out the FERPA release form so you can access your student’s academic grades and records.
- Roommates. Whether your son or daughter is going to school or just moving out, always try to get additional contact numbers (mobile phones, email) of roommates or neighbors so that you can get in touch with your child in the event of an emergency.
We usually don’t think about our children needing to sign legal documents. But before you send your child off to college or to live on their own, there are two legal documents that you need to make sure they have. The documents are a:
- Medical Power of Attorney + HIPAA Release,
- Financial Power of Attorney; and depending upon their circumstances
- Will, FERPA and Directive to Physicians
It may come as a surprise to parents and children alike that a parent needs to have legal authority to act for their child, but an 18-year-old is a legal adult. If a parent is to be the child’s backup for medical and financial decisions these documents need to be signed as soon as the “child” turns 18. Without these documents, parents do not have the authority to make health care decisions, make financial decisions or manage money for their children after they turn 18. This is true even if they are paying their child’s college tuition, still have their child on their health insurance and claim them as a dependent on their tax returns. In fact, we have had to get an expensive and time- consuming guardian for parents whose adult child did not have these documents.
Medical Power of Attorney for Health Care Decisions + HIPAA
A Medical Power of Attorney authorizes a parent to make medical and health care decisions on behalf of their young adult and to receive medical information. If a young adult is ill, in an accident or otherwise becomes incapacitated, even for a short time, then a medical power of attorney is imperative. The time to consider this is NOT in the emergency room when the doctor is asking if you have medical authority or the hospital requires a HIPAA release before they will discuss the case with you. Without this written authority to act a parent will need to go to court to be named guardian to act on his or her child’s behalf.
There are many horror stories about clients who find this out the hard way.
For example: one of our clients had a student in her first year in college who went to the school clinic for a routine allergy checkup. At the checkup the doctor noticed a growth. As a result of the subsequent tests it was discovered that she had a certain type of cancer. She called home hysterical and the parents made an emergency call to talk to the doctor. They were told that the doctor could not talk to them and he was not allowed to provide them without any information regarding their child’s condition because she was over 18 and they were not legally appointed her medical power of attorney. A lot of anxiety could have been avoided if the young woman had signed the medical power of attorney before leaving home.
Financial Power of Attorney
Similarly, if your child has an accident and you need to deal temporarily or permanently with his or her financial affairs you will have to have a Financial Power of Attorney in order to act. In Texas, this document is formally called a Statutory Power of Attorney, and it is effective when a person is incapacitated, unavailable and / or unable to make their own financial decisions. Not only can an agent under a financial power of attorney make financial decisions, but also the agent can negotiate contracts or leases and deal with other financial matters if the child is incapacitated, in an accident or the hospital or just out of the country. Without this simple document, banks and other financial institutions will require a formal guardianship which is costly and requires court supervision and accounting annually.
Last Will and Testament
If your child has a bank account, however small, or a savings account or an UGMA account that his or her grandparent set up they need a Will. If your child participates on social media and has a Facebook, Instagram, Twitter or gaming accounts – you need to have a “personal representative” appointed who can close down these accounts. The cost of closing out an account (digital or financial) without a Will is almost 5X the cost of probating a simple Will and getting access to these accounts.
Moral of the Story: Help prepare your newest adult for this first gap. Have your son or daughter meet with a member of our firm to go over and sign a Medical Power of Attorney and a Statutory Power of Attorney before it’s too late!