August is the start of a new school year. This is a time when many parents are getting ready to send their children off to college. During this hectic and emotionally tumultuous time, parents may be all-consumed with helping prepare their soon-to-be college student for the next phase, causing them to overlook important estate planning matters.
Now, is a great time for parents to consider a few important estate planning tools they should add to their to-do list as they get ready to send their kids off to college.
1. Power of Attorney for Health Care
Every year, roughly a quarter of a million young adults between the ages of 18-25 wind up in the hospital. From alcohol poisoning and nonlethal accidents to unexpected illnesses, it’s important to remind parents to hope for the best but prepare for the worst. Once a child reaches the age of 18, a parent’s decision making role is significantly diminished, especially in regards to making healthcare decisions.
Should a child get in a car accident, or fall ill and not be capable of making their own medical decisions, then without a power of attorney naming the parents as health care agents for the child, the parents cannot make medical decisions on their child’s behalf. If parents want to ensure that they can continue to make healthcare decisions for their child, working with their child to create a health care power of attorney should be at the top of their to-do list.
2. HIPAA Authorization
In order to make informed medical decisions, it’s important to include a HIPAA authorization form along with a health care power of attorney. Without it, parents may be unable to communicate with healthcare professionals and insurance companies, as well as access their child’s health records and previous treatment information.
3. Power of Attorney Property (Finances)
Similar to a health care power of attorney, a financial power of attorney gives parents the ability to make financial decisions on their child’s behalf, should they be unable to do so themselves. Should the child become disabled for any reason, then your clients would still be able to pay their child’s rent, credit card bills, utilities, access bank accounts and financial records, as well as manage any loans they may have.
4. FERPA Release
The Family Educational Rights and Privacy Act is designed to protect a college student’s privacy, but it can also leave parents locked out in an emergency. A properly worded release can allow parents to talk to school officials and release pertinent educational records and information should they need it.
5. Last Will and Testament
While many parents don’t want to think about this topic, especially as their child leaves home, it’s an important one to add to the list. A Last Will allows parents to honor their child’s wishes on what should be done with their social media accounts, bank accounts, and personal assets. It also allows the child to specify any funeral arrangements they would like to have.
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