When your child is close to graduating from high school, they’re likely enjoying all the excitement of anticipating college or starting a job, going on a final road trip with friends or family, and thinking about their future path in life. As your child turns 18, estate planning is probably the furthest thing from their mind, especially since there might be a misconception that because they have few financial assets, there’s no real reason to create a plan to protect them.
However, according to the law, your teenager is no longer a minor at 18 and assumes many new adult responsibilities. An estate plan is a perfect tool to help them learn right away how to best navigate aspects of health and financial management. Our Brooklyn estate planning attorneys for young adults can help with these specific needs.
Reasons Your 18-Year-Old Needs an Estate Plan
Approximately 80 percent of people in the U.S. don’t have an estate plan. Many Americans believe that an estate plan is only about ensuring their beneficiaries get the assets and money bequeathed to them. But there’s a lot more to an estate plan—here are a few reasons why a young person would need one at 18.
It’s hard to think about something unimaginable happening to your child. But what if your 18-year-old developed a sudden illness, was in some type of accident, or died unexpectedly? Without the proper estate planning documents, your rights to make decisions for and about your child might be limited, and the court may make those decisions for you. The following documents can help make trying times easier according to what your teen truly wants.
Health Care Proxy
The Health Insurance Portability and Accountability Act (HIPAA) takes effect when your child becomes 18. This means their medical records are now confidential, and parents have no right to them—even if they're paying for medical bills and health insurance. You might have to petition the court to become your child’s legal guardian, even though they’re considered an adult, so you can make critical medical judgments on their behalf. It’s also possible that no medical information would be disclosed to you until you become their guardian, which often takes a lot of time and money.
But if your teen has a health care proxy document as part of an early estate plan, they can designate you as someone authorized to make health care decisions if they’re unable to do so.
Power of Attorney
If your child hasn’t appointed a power of attorney, you’ll likely have to go to court to become their conservator. Not only does this take money, but it also takes time to get that approval—and while you’re waiting, you won’t be able to delay payment on any of your child’s auto-pay bills. You also won’t have access to their credit cards or bank account. Even if your child doesn’t have a significant amount of money or an estate, they may have personal items, a car, and a savings account that they’d like to leave to special people in their life.
An estate plan that cites you as the power attorney gives them—and you—control over these assets.
Your child may have told you that if they were in an accident, they don’t want to be put on life support or be resuscitated. However, if they don’t have a living will in place that stipulates their wishes, it’s unlikely their intentions will be honored by the court because there’s nothing in writing to prove that’s what they wanted. Ultimately, the court would decide what type of treatment your child receives.
How Brooklyn Estate Planners for Young Adults Can Help
Young adults taking the next steps in their future are often eager to do things that bring them financial security and control over their own lives. This is the perfect time for you and your child to come together on decisions that establish a thoughtful approach to the future on their terms. Creating an estate plan doesn’t have to be about dying or planning for the end—rather, it’s a way for your child to plan for taking on adult responsibilities and being the master of their own fate. Take an hour or so to consult a skilled financial planner who can explain the benefits of certain components of an estate plan that addresses their current needs and help put things into motion.