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Rio Grande Estate Planning, LLC

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College Planning: A Power of Attorney for Finance and Healthcare for Your Student

The Brief

For some students, next semester means starting college, which may include leaving home for the first time.

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Aggie, Lobo, or otherwise, once a child reaches the age of legal majority, they are considered an adult with privacy rights.  This means that parents could possibly lose access to private information. This can have dire consequences if the student is involved in an accident or gets seriously ill, explains the article “Navigating The Transition To Adulthood: A Legal Guide For Parents” from mondaq. With proactive steps, parents can address these situations before they occur as part of the college planning process.

Whether or not your insurance covers your child’s healthcare may not matter. Without a Durable Power of Attorney (“POA”) for healthcare decisions, parents might not be able to make medical decisions, speak with healthcare providers, or talk with the health insurance company. Parents are strongly urged to have their college-bound student complete a Durable Power of Attorney for healthcare decisions.

If there is no POA and the child is incapacitated, parents could find themselves having to go to court to be able to make medical decisions for their child. Hospitals and healthcare providers are extremely strict about following these rules to avoid litigation and fines. No matter how bad the situation is, don’t expect any rules to be bent.

Your adult child should also have an Advance Healthcare Directive. This is a document controlling decisions about end-of-life. It only becomes effective when a person is in a state of permanent unconsciousness, like a coma, or if they are terminally ill. The student uses this document to express their wishes concerning care: do they want to be artificially fed, hydrated, or kept alive by extraordinary means? Do they want to become an organ donor? This document conveys their wishes and can save the family an unimaginable amount of added stress during a trying time.

A Durable Power of Attorney for financial decisions is used to name a person, known as an “agent” or “attorney in fact,” to act on their behalf. The agent can take care of legal and financial matters. This is needed in case of incapacity so the parent or trusted person may deal with financial institutions, colleges, courts, and any other company or organization on behalf of the student. Without it, parents cannot access account information or act on the student’s behalf.

Does your student need a Will? The estate planning attorney who helps create the documents listed above can help you answer this question. Depending on their situation, if the student owns a car, has a bank account, an inheritance, or sizable cryptocurrency accounts, they may need a Will.

The documents mentioned above should also be in place for parents. If parents don’t have a Will, Durable Power of Attorney for healthcare or financial decisions, Advance Healthcare Directive, or Trusts (revocable or irrevocable), if appropriate, their newly minted adult will have a lot to deal with if they should both die unexpectedly. A visit to the estate planning attorney for all generations is a good idea.

Reference: mondaq (June 24, 2024) “Navigating The Transition To Adulthood: A Legal Guide For Parents”

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