If Your Kid Is 18, You Need These Documents

When your child turns 18, the experience can be an emotional one for you as a parent, as well as for your son or daughter. Adulthood suddenly becomes real – not just some “far off in the future” concept. And it happens a lot sooner than you probably were expecting it to, especially if your child is still a dependent.

In addition to the emotional aspects, you and your child will come face to face with certain legal realities. Specifically, your rights as a parent diminish when your child turns 18, including the right to know anything about their finances, medical condition or even school records. That means, for example, that if your child were injured, you wouldn't have the right to make medical decisions on their behalf.  

There is a remedy to this, and it involves having certain documents in place. (For a primer on smart money moves for your child, read: 8 Financial Tips for Young Adults.)

Under the Family Educational Rights and Privacy Act, or FERPA, students age 18 or older must provide written consent before education records such as grades, transcripts and disciplinary records can be shared with parents. This law applies to students who attend a school that receives any funding from the U.S. Department of Education.

Most public high schools as well as public and private colleges and universities notify parents about this requirement. Ultimately, though, it is up to you to make sure your child signs a release to give you access to their records.

Commonly called HIPAA, the Health Insurance Portability and Accountability Act prevents anyone not named in a signed release from receiving medical information about another adult. It won’t matter that the adult is your child. Your son or daughter can sign a full release or set limits on what information may be shared.

Most experts recommend a full blanket authorization since you may not know in advance the nature of the medical condition of your child. You should also have the signed authorization in your possession, so you can show it to any doctor, hospital or other medical provider as needed. (For more see: COBRA and HIPAA Provisions.)

A medical power of attorney is also sometimes called a healthcare power of attorney, healthcare proxy or durable power of attorney for healthcare. All those designations refer to a document that gives you the ability to make decisions about your child’s healthcare.

Typically, a medical power of attorney doesn’t become active unless your son or daughter is physically or mentally incapable of making his or her own medical decisions – although each state has its own criteria, including whether the document must be witnessed or notarized. Note that a medical power of attorney is not the same as a living will.

A living will, also known as an advance directive, addresses such things as your child’s wishes regarding life-extending medical treatment and organ donations. Having this document in place can help avoid the potential pain and anguish of different family members being at odds about how to handle a tragedy, such as an automobile accident.

Children can also grant their parents a durable power of attorney to handle business for them in the event they become incapacitated, if they are simply out of the country (say, studying aboard) or if, for some other reason, they need you to assist with their affairs. A durable power of attorney allows you to access bank accounts, sign tax returns, renew car registration and perform other transactions.

Your child can restrict the types of transactions you can perform or grant full access and also grant the power of attorney with a timeline including a starting and stopping date. (For more see Medical vs. Financial Power of Attorney: Reasons to Separate Them.)

If your child is away at school and all you really want is access to tuition and housing accounts, many colleges allow students to grant such access to parents without the hassle of a power of attorney. Of course, any joint accounts that you and your child share are open to you without special permission.

Most of these documents can be created without hiring a lawyer, although some people choose to involve an attorney to make sure the paperwork is complete and accurately executed. In most cases documents must be signed, witnessed and notarized.

It’s important to sit down with your child before you ask them to sign anything. Discuss the reason for the document or form, consider your child’s concerns and, in general, do your best to treat them like the adult they have now become. After all, their reaching adulthood is the reason why these documents are necessary.