Graduating from high school is an exciting time for so many reasons. For many, it means they’re heading to college, or about to begin basic training, or even starting work full-time. Graduation also symbolizes a new beginning as graduates begin to have the freedom to make some big adult decisions without their parent(s) deciding for them. With this freedom of being an adult comes the legal protections afforded all adults.
For 18 years, parents or guardians could easily make doctor's appointments and check bank account information, but as soon as that child turns 18, those privileges are revoked. Without the proper documents in place allowing a parent or guardian access to private, protected information, that parent or guardian will be given the “silent treatment” by any financial institution or medical provider, even if the child is incapacitated. This is why we recommend all young adults have at least a Durable Power of Attorney, Health Care Power of Attorney, and HIPAA Authorization in place.
Durable Power of Attorney
Do you think I actually need these things? Aren’t these things only for adults with an estate plan? The answer is yes to both questions. Here’s why…
A durable power of attorney (also referred to as a financial power of attorney) allows your child to appoint someone they trust, also known as your agent, to step in and take care of their money if something were to happen. Many young adults will choose one or both of their parents to serve as their agent(s).
A durable power of attorney allows your agent to do things like pay your rent, collect your paychecks, and file any needed financial paperwork on your behalf without any type of court proceeding. Even if you think you don’t have a lot of money, a durable power of attorney is still recommended. Otherwise, a parent or guardian couldn’t even be given the balance on your bank account if something were to happen.
Health Care Power of Attorney
A health care power of attorney allows your child to appoint someone they trust to step in and make medical decisions if something were to happen and they’re not able to tell a doctor what they want to happen.
For example, if they’re in a car accident and cannot tell the doctors how they want to be treated, the medical team could call the agent (often a parent or both parents) and ask your agent what to do. Without this document, there is no clear guidance as to who should be making medical decisions for you, and if there is disagreement between loved ones on what decision(s) to make, everyone could end up in court.
When a child is a minor, parents or legal guardians are allowed to make appointments and get information from medical providers, but those permissions change when someone turns 18 under the Health Insurance Portability and Accountability Act (HIPAA).
The HIPAA authorization allows anyone you wish to have access to your medical information to have access to it. For young adults, this is often their parents or legal guardians. Without a HIPAA Authorization, the only person entitled to the young adult’s health information is him or herself.
How can I set up these documents?
Graduating high school and becoming an adult is a big life change. Any time you encounter a big life change whether it be for you or a child, you will want to review your estate plan for any potential updates, including updating documents if your child is no longer a minor and they now need their own estate planning documents.
If you are a parent with a recent high school graduate or a young adult without power of attorney documents and would like to get those in place, our team at Carolina Family Estate Planning would be more than happy to assist you. Please give our office a call at 919-443-3035 to schedule your appointment.