Estate Planning: Essential Documents for Young Adults
Estate Planning: Essential Documents for Young Adults
At 18 we feel invincible, and like our life is just beginning, so planning for seemingly impossible what-ifs might seem unnecessary. But life is nothing if not unpredictable. 18 is an age when we want to feel in control but often also feel secure under the parent-child relationship, like parents are the safety net if anything goes wrong. Legally, however, that’s no longer the default status.
We’ve written about the importance of Estate Planning for Singles, and this applies to young people as well. Consider that college health clinics and hospitals can’t release admission or medical information to parents even if the student’s tuition is paid for by the parents or the student is on a family health plan. Parents can find themselves in court petitioning for access instead of bedside with an injured or sick child. With just a bit of advance planning, 18 year olds can start their adult lives on responsible footing.
Durable Power of Attorney
You may have heard people talk about a durable power of attorney when someone is incapacitated or dying. It’s a document that you’ll hopefully never need to use, but both you and your loved ones will be glad it’s there if that need ever does arise.
A durable power of attorney is a document that you create to give someone else the legal authority to make financial decisions on your behalf, in case you’re ever unable to make them for yourself. The creator of the document is called the principal and the person who is named as the authority figure is called the attorney-in-fact. (This person doesn’t have to be a practicing attorney; you might choose a parent or trusted sibling as your attorney-in-fact.) Note that this document doesn’t give your appointed person any power over your estate after your death. In Massachusetts, the attorney-in-fact’s authority ends when the principal dies.
If you were seriously injured or ill, your attorney-in-fact could do things like write and sign checks for you, contact your banking institutions, transfer property and otherwise keep your life in order while you’re receiving medical care. That said, executing a durable power of attorney may prove useful even if you live a long and healthy life. If you’re traveling internationally and lose your credit card, for example, your attorney-in-fact would have the legal standing to contact the credit card company on your behalf.
Health Care Proxy
Think of a health care proxy as the medical version of a durable power of attorney. It’s a document that allows you (the principal) to name someone (called a health care proxy or agent) to make healthcare decisions on your behalf, if a time comes when you can’t make them for yourself. If you’re badly injured in an accident and a decision needs to be made about whether or not you’ll have surgery, for example, your health care proxy could make that choice.
If you became incapacitated and had no proxy, your loved ones would need to petition the court to make medical decisions for you. This process is long and complicated, and it’s the last thing your loved ones will want to do while you’re seriously ill.
Don’t worry that naming a proxy means you’ll lose your rights to make your own medical decisions. This person only gets to step in if you’re unable to speak for yourself, and you can establish some limitations when you first sign the document. If you don’t ever want to undergo a certain kind of procedure or treatment, note that on the proxy form and your designated agent won’t be able to overrule you.
In Massachusetts you may only have one designated health care proxy at a time. You may name an alternate proxy, who will step in if your primary proxy is unavailable at your time of need.
HIPAA Release
A HIPAA release is an important complement to a health care proxy. Executing one of these documents allows you to give permission for your loved ones to be informed about your medical care, in the event that you’re incapacitated. If you were to become unconscious and didn’t have a completed HIPAA release, your doctors would be limited in who they can share information with.
Unlike with a health care proxy, on a HIPAA release you can name as many family members, friends or other individuals as you want. You might even opt to list your attorney on your HIPAA release, in the event that you’re injured through no fault of your own and want your attorney to have access to specifics about your condition.
Rest assured that executing a HIPAA release does not give your named individuals open access to your medical records, and it doesn’t give them the right to make medical decisions for you. Only the health care proxy does that. This document simply allows you to name the people with whom your doctors can share information, if necessary.Creating these essential documents might sound intimidating, confusing or just unnecessary for your current life. Let the attorneys at the Ladimer Law Office walk you through the process. We understand that new graduates and young adults have a lot of questions about how they can protect themselves, and our attorneys want to help. Contact us today to prepare for the next chapter.