Imagine this scenario. You are awakened by a phone call in the middle of the night. It is someone alerting you that your son or daughter, who is away at college, has been in an accident. They are in the hospital in critical condition. Of course, you drop everything and rush there. When you arrive, your child is on life-support and in need of a lifesaving operation, and you are stunned when you are told you need to get authorization from the court to give the doctors permission to proceed!
A nightmare? Yes, but it could be very real, if your child did not sign a power of attorney, (POA) and/or a medical surrugate form before he or she left for collage.
If you are about to, or have recently sent your child off to college, it is very important that you have them sign these two forms. Once your child is 18 or over, you may think you can still make important medical decisions for them, however, without a POA in place, or at the very least having you officially listed as their medical proxy, if they should fall victim to a medical emergency out of state, or out of the country, critical medical decisions may not be yours to make. Can you imagine a court needing to appoint a guardian, rather than yourself, to make critical decisions about his or her care?
Believe it or not, in most states, parents do not have the authority to make health care decisions, or financial decisions for that matter, on behalf of their kids, once their children turn 18. If they are over 18, and away at school, that still applies, even if you are paying their tuition, still carrying them on your health insurance plans, and/or claiming them as dependents on your income taxes.
By signing the POA, young adults are granting their parents the legal right to act on their behalf should they become incapacitated in any way, while they are away at school. Again, in lieu of the POA, you should at the very least have a Designation of Health Care Surrogate and “living will” form filled out and signed.
How MBAF Can Help
At its most basic level, estate planning is all about being prepared for possible worst case scenarios that can befall your family at some point in the future. Having your kids sign a POA before going to college, is just another way to be best prepared for a “what if” occurrence.
As individuals who have only just assumed the mantle of adulthood, it may be difficult to get your college-bound kids to sign a POA. After all, they often see going off to college as a rite of passage, and a way to break from parental control and influence. Also, if they have any knowledge of a POA, they may associate it with “giving total control” over their affairs to someone else. This is often the challenge in getting elderly folk to sign a POA, as they fear abuse of their finances. That may not be the case with college kids. However, they could fear that the POA will give you access to their grades, and other things that normally are private matters between the student and the university.
Still, it is best that you as the parent, be the first one to broach the subject of a POA. Then, we will not only will be able to help you draft the necessary papers, but as a third party, we can sit down with your entire family, and help explain the critical need for the documents, and allay any fears they may have. We can also help you set up the POA, and specify what it gives you access to, and what it does not, so that the whole family will be comfortable with this very important decision.
Estate planning can be complex. If you would like to benefit from our expertise in these areas or if you have further questions on this Advisory, do not hesitate to contact our Tax and Accounting specialists, or call us at 1-800-239-1474.