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Estate Planning for Young Adults
By William C. Mason III
If you are a parent, you are likely accustomed to possessing broad authority to make decisions pertaining to your child’s health, finances, and overall welfare. However, once your child reaches age eighteen, the legal landscape changes and your ability to make these important decisions evaporates. At age eighteen, your child has complete discretion to enter binding legal contracts, borrow or loan money, consent to or decline medical treatment, and make several other significant decisions pertaining to their day-to-day lives. But what if the occurrence of some unforeseen event renders your child severely injured, unconscious, and/or incapable of making the decisions vital to enjoying the rights and obligations associated with reaching the age of majority? By executing a simple estate plan, your child can ensure the efficient and effective management of their legal, financial, and medical life should they become temporarily—or permanently—incapable of self-management.
A simple estate plan consists of these primary documents:
Durable Power of Attorney: A document whereby your child designates an agent responsible for managing that child’s legal and financial affairs (such as managing property, engaging in banking transactions, or filing taxes) should he or she become incapacitated.
Advance Health Care Directive and HIPAA Waiver: A document whereby your child designates an agent responsible for making health care decisions for that child should he or she become incapable of making these decisions on their own. Similarly, a HIPAA Waiver acts as a companion document which authorizes your child’s agent to access that child’s confidential medical information allowing that agent to make better-informed decisions regarding your child’s medical care.
Last Will and Testament: While most young adults likely have not amassed an estate sizeable enough to merit creation of a trust, execution of a valid Last Will and Testament facilitates the seamless transfer of your child’s modest estate to his or her heirs and designates a guardian for his or her minor children.
While no parent can possibly imagine a situation in which utilization of the above would become necessary, creation and execution of these simple yet powerful documents help to ensure that your adult child will be properly cared for should the unthinkable occur.