Estate Planning for Parents of Adult Children
Even the best prepared parents don’t always recognize the need to reassess estate plans and property ownership when a child turns 18. In some ways, of course, your legal concerns are simplified when your child becomes a legal adult. You no longer need to make provisions for guardianship of the child in the event of your death or incapacity, and the child can inherit directly without the need for a guardian to manage his or her property.
Posted on July 10, 2017
However, a child reaching the age of majority introduces new issues, as well. Some are entirely new concerns, while others represent the flipside of your prior concerns.
Adult Children Can Inherit Directly and Manage Assets—In Theory
The fact that adult children can inherit directly and obtain sole control of inherited property, either through a will or through intestate succession, seems on the surface to simplify estate planning. When the child was a minor, it was necessary to appoint someone to manage inherited property on behalf of the child, or to risk appointment of someone you might not have chosen.
However, simply passing property directly to a young adult child isn’t always the right answer—particularly if you are passing extensive assets. You may not be doing an 18 or 19-year-old any favors by placing significant assets in his or her hands without restriction if you unexpectedly pass away. Yet, if you fail to make specific provisions, that’s exactly what will happen.
Reassessing your estate plan when your child reaches the age of majority will allow you to determine the best course of action for your family, and to take measures such as creating a trust that will allow you to control how your assets are distributed to your adult child.
Adult Children Have Their Own Assets and Liabilities to Manage
Though a young adult may not have significant assets or liabilities, most have bank accounts, and many have credit card accounts, automobiles, and other property and debts. None of us wants to think about a young person becoming incapacitated, even temporarily, but good preparation means considering every eventuality.
Once your child has reached the age of majority, you may be unable to conduct business as simple as finding out how much you’ll have to pay to keep a credit card account current or renewing vehicle registration. Preparing for the unexpected with a Power of Attorney that allows you to manage your child’s affairs if he or she is incapacitated will empower you to protect the child’s assets and credit rating during a crisis.
Access to Medical Information is Not Automatic
Throughout your child’s life, you have undoubtedly talked with his or her doctors, read test results, and paid medical bills not covered by insurance. When your child becomes an adult, the law cuts off your access to that type of information. Though the child may still live with you, look to you for care and support, and depend on you for medical insurance and payment of medical bills, you're no longer legally in the loop. Of course, your child can choose to share the information with you on a case-by-case basis, but this type of patchwork approach can have unexpected consequences—particularly if an emergency arises.
Depending on the specifics of your situation, this access issue can be addressed through simple releases, or with a healthcare power of attorney. While there’s no one-size-fits-all solution, the issue is one that should be addressed by any family with young adult children who are unmarried.
A New Jersey Estate Planning Lawyer Can Help You Prepare
The right time to address issues relating to inheritance, access to medical information, decision-making in a medical crisis, and management of finances if a person becomes incapacitated is long before these issues arise. If your child will soon reach the age of majority, or is already a legal adult, and you have not yet assessed these and other estate planning and healthcare issues, don’t delay. Talk to an experienced estate planning lawyer to learn more about how you can best protect your family.
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