When their now 18-year-old child is heading off to college, parents think about getting them ready by opening bank accounts, researching financial aid and buying bedsheets and other household items in preparation for dorm life. The last thing on their to-do list is planning for an unforeseen event that could alter their child’s quality of life.
During that heady period between high school graduation and the path into adulthood, parents in Tennessee must realize that their now adult child is no longer a dependent, so if health concerns or life changes occur, they may not be able to help out as they once could. Learning more about these and other estate planning tips can help families in Jackson and surrounding communities navigate their child’s future security.
What is a power of attorney?
A power of attorney (POA) is a document that allows someone, called the agent or attorney-in-fact, the legal authority to act on behalf of another, called the principal, in matters ranging from financial to health decisions. A POA may be:
- Limited in scope or duration and used for specific reasons, for example, proxy signing in real estate transactions or access to bank accounts for specific financial transactions.
- Durable and immediately in effect on incapacity of the principal, for financial or medical financial concerns.
- Springing, or becoming effective at a future time, in the event of incapacity or disability, for example.
Why would my child need a POA?
When kids head for college, many are going out into the world for the first time. This new independence makes them feel truly like adults, but we must remember that it wasn’t so long ago that they were living at home and dependent on their parents. Unfortunately, some young people may make adult decisions or get into serious situations that they may not be able to handle during their college years.
Establishing a financial POA or advanced directive for healthcare for your college-bound child can save serious headaches and legal worries that parents may have to go through should their child become incapacitated. Having a POA in place prevents parents from going to court to request permission to be their child’s proxy. For children who are in college out of state, it is possible to transfer this POA to the state of residency.
Of course, the child needs to be on board with these decisions, but getting advice from a parent who loves them and who is someone they trust who has their wellbeing in mind can make all the difference.