Important Documents Every Parent Should Complete Before Kids Leave Home
According to the Urban Institute, three out of five full-time college students live in college housing. Many young adults also move out of the family home even if they do not attend college. Although the Bureau of Labor Statistics suggests that the number of young adults leaving home is declining, this still represents a major turning point for many parents and adult children each year. As families approach this milestone, they may want to consider creating or adjusting various important documents. Many of these important documents are estate planning tools, and one might assume that estate planning is only necessary for elderly individuals. An estate planning lawyer in Florida may be able to explain how this is not always the case. Estate planning lawyers may also help parents understand why it is important to begin this process before kids leave home. Consider expanding on this conversation with Loughlin Law, P.A. by contacting us at (561) 677-8384.
Consider a Health Care Surrogate Before the Kids Leave Home
In Florida, a “designation of health care surrogate” is an estate planning document that could prove useful when the kids leave home. This document states that if a “principal” ever becomes incapacitated, a surrogate has the right to make health care decisions on their behalf. For example, the principal might fall into a coma after a car accident. In this case, the health care surrogate would have the legal authority to decide whether to remove the patient from life support. A health care surrogate might also decide whether to move forward with a risky surgery after a principal suffers an incapacitating brain injury.
Why is this type of document useful when the kids leave home? Because until a child turns 18, this document is unnecessary. A parent can automatically act as the health care surrogate of their child without first creating a designation of health care surrogate. When the child turns 18, however, they become a legal adult. As a result, the parent no longer has the right to make medical decisions on behalf of their incapacitated child. With a health care surrogate, the family can continue to have a say in the decision-making process if an incapacitating injury ever occurs. Note that the adult child must consent to this process, and they may choose not to create a health care surrogate. They also have the right to choose someone other than their parent to act as their designated health care surrogate.
Consider a Basic Will Before the Kids Leave Home
Parents might also want to encourage their adult children to create basic Wills before they leave home. Most adult children do not have considerable assets when they leave home, but financial wealth can grow at a surprisingly fast rate. This is particularly true regarding young entrepreneurs with innovative new ideas. A Will ensures that regardless of how fast the adult child accumulates wealth, the family can avoid time-consuming and stressful probate processes in the event of an unforeseen fatality.
Wills are also useful when addressing debts. If an adult child accumulates considerable debt after leaving home, the family may “inherit” these liabilities in the same way they would assets. A Will could mitigate the impact of these debts. Consider discussing these strategies in more depth with Loughlin Law, P.A.
Is Your Child Leaving Home Because of a Marriage?
While many adult children leave home to enroll in college, others leave due to marriage. While this can be an exciting time for the entire family, it also presents numerous legal implications. First, parents may want to provide gifts or financial aid to their adult children in a careful manner before they leave home. If parents are not careful, a spouse could gain access to these assets during a divorce. This is true even if the parents never intended to provide any gift or assets to their son or daughter-in-law.
To avoid these issues, consider writing a clear gift letter before providing anything to the adult child. As long as parents address their gifts directly to their children, these gifts should remain “separate property” in the event of a divorce. In other words, the gift will not be subject to the equitable distribution process in Florida. Gift letters are easy to create, especially when drafted by experienced lawyers. While simple, they may prove instrumental in preserving family wealth.
Do I Need to Adjust My Will Before My Child Leaves Home?
In addition to helping their adult children create basic Wills, parents might also want to adjust their own Wills before the kids leave home. For parents with children under 18, guardian appointments represent a key priority during the estate planning process. Guardian appointments ensure that if anything ever happens to the parents, a pre-designated individual will look after the children. This is no longer necessary if the adult child is above the age of 18, so the existing Will may require adjustment to remove these guardian appointments.
At this point in time, parents might also feel more comfortable leaving their adult children more substantial assets with fewer conditions. For example, a parent might state in their Will that their child should only receive their inheritance when they turn 18. This is obviously redundant if the child is already 18 and has already left home. Parents should strive to remove anything confusing or redundant from their Wills, as this confusion may make the documents less enforceable in court. Parents might also want to add new conditions to their Wills based on the unique life path that their children have chosen. For example, a child might enroll in medical school. The parent of that child might adjust their Will or trust to distribute assets only if the child completes medical school. A different child might begin to struggle with substance abuse before leaving home, and a concerned parent might adjust their Will or trust to only distribute assets if the child completes rehabilitation and “gets clean.”
Consider Speaking With Loughlin Law, P.A. When the Kids Leave Home
While there are some estate planning documents that all parents should consider when their kids leave home, the most appropriate course of action may depend on the unique circumstances of each family. Certain documents may be more important than others based on the specific adult child, their health, and their financial situation. For example, a young adult in the middle of launching a startup may need to focus more on protecting their financial well-being. In contrast, an adult child with notable health challenges might want to focus more on healthcare planning. Whatever the case may be, an experienced estate planning lawyer in Florida may be able to help parents assess the most appropriate options. Contact Loughlin Law, P.A. at (561) 677-8384 to expand upon this conversation.
