Beyond the Basics: Planning Tips for When Your Children Enter College

It is nearly back to school time. Many students are beginning college for the first time, and parents are helping them transition to a new future. Parents are helping their children get ready for orientation, a new dorm room, new roommates, and buying books. However, it is important for parents to also make plans for their children’s health and financial needs.

Once children reach eighteen years of age, they are no longer “minors,” and parents no longer have the automatic right to make health care decisions or financial decisions for their children. I advise many parents to have their children sign a medical directive (called a Health Care Proxy in New York, and a Power of Attorney for Health in most other states), and a Power of Attorney for financial assets.

Many people think that only older people should have these documents. As people reach their later years, they often need help managing their finances or making medical decisions, and having these documents in place make it easier for families to take care of their parents’ needs. Many children also need similar help making these difficult decisions. Therefore, it is highly recommended that the child, who’s barely an adult, sign these forms before leaving for school.

When a child in college gets hurt and needs medical assistance, a parent does not have the right to know what has happened and usually cannot get access to any medical information, unless a document is in place which permits this. Should a child be in an accident, need to go to a hospital, or encounter any health-related problem, a parent can be in a position to continue the care they have been providing since birth, if the appropriate documentation is in place. The Health Care Proxy designates an agent (and usually a backup agent) who can make medical decisions on the child’s behalf. Other uses for the Health Care Proxy include allowing a parent to transfer a child’s medical records from their local physician to the college, or from the college to their local physician when the child comes home.

An equivalent document for financial matters is called a Power of Attorney. This is a legal form which enables a parent to help with their child’s financial affairs. Typical uses include permitting a parent the right to interact with the college’s bursar so as to manage the child’s tuition. You can also help oversee your child’s finances, because once a parent has this document, they can make deposits and withdrawals and even manage student loans. Other potential uses for this document include negotiating and signing apartment leases, dorm fees, and other similar financial matters which arise.

While transitioning to college can be an intimidating period for both parents and children alike, it is important to remember to not only plan for academics and student life, but also for other possible contingencies, so as to navigate this unique time as smoothly as possible.

This article is intended as a general discussion of these issues only and is not to be considered legal advice or relied upon. For more information, please contact RPJ Counsel Jeffrey L. Blankstein whose practice areas include estate and retirement planning, individual taxation, real estate and litigation. Mr. Blankstein is admitted to practice law in New York.