There is a common misconception when it comes to estate planning: only people with significant wealth need an estate plan. In fact, an estate plan is simply a set of documents that tells the world what we want to happen to our bodies and with our finances when we are unable to do so ourselves. In that sense, nearly any adult can benefit from an estate plan, including our youngest adults.
When a child turns 18, the legal decision-making authority regarding the child’s health and finances shifts from that child’s parents to the child. While no parent takes joy in planning for their child’s potential death or incapacity, without the proper documents in place, a parent may face roadblocks to making important decisions in the event of an emergency. Having an estate plan in place for a young adult child in the event of such an emergency can bring an added level of security to both the parent and the child, particularly at an age when many children are leaving home for the first time to attend college or start their first job.
Parents of young adults should consider working with their child and an attorney to put the following documents in place:
- Financial Durable Power of Attorney. This document gives an agent (another person, for example, a parent) the authority to make financial transactions, or sign legal documents on an individual’s behalf. Among other things, this document will allow the agent to access accounts, pay bills, and file tax returns for the young adult. This document can be structured to be effective immediately, or only go into effect if the young adult becomes mentally incapacitated or otherwise unable to perform these activities on their own.
- Durable Power of Attorney for Health Care. This document allows an agent to make health care decisions for the young adult. Similar to the Financial Power of Attorney document can be structured to be effective immediately, or only go into effect if the young adult becomes mentally incapacitated or otherwise unable to perform these activities on their own.
- Health Care Directive (Living Will). This document guides the young adult’s doctors and caregivers regarding the young adult’s medical care preferences in the event that the young adult is unable to make their own decisions (for example, if the young adult is terminally ill, seriously injured, or in a coma).
- Other Documents. In addition to executing powers of attorney, a young adult may also wish to execute the following documents, depending on the circumstances.
- Will – A Will may not be necessary for many young adults, since Washington intestacy laws direct a young adult’s estate to the parents if the young adult dies without a Will and does not have a spouse or children. However, a Will can be helpful to nominate a Personal Representative (executor) of the young adult’s estate, which may be especially important in split family situations.
- Disposition of Remains Instructions – This document directs what will happen to the young adult’s remains in the event of death (i.e., whether the body should be buried or cremated and who should have authority to direct any decisions related to the disposition of remains).
- HIPAA Authorization Forms – These documents authorize medical professionals to release confidential medical information to their parents (or other individuals). These forms are generally unique to each healthcare provider, but a parent may want to seek such authorization from the child’s regular physician, or from the college or university the child is attending.
If you are interested in putting estate planning documents in place for your children (or yourself), you may reach out to our estate planning attorneys including Ryan Montgomery, Kara Kalenius Novak, Kaitlyn K. Perez, Allison Int-Hout, and Matthew Hart.