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Preparation

Kids Going Away To College?

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Why You Should Include Estate Planning in the Preparation

You may have been running around for weeks, getting your new college student off to school.  It’s exhilarating, and your heart likely is bursting at the seams.  You’re probably prouder than you can say, but you’re a little afraid, too.  How can you make sure your kid is going to be safe at school, so far away from home?  A new Bed Bath and Beyond matching sheet set for the dorm sounds great, but it just doesn’t seem like quite enough, does it?  So, what else can you do?

Actually, there is something, probably not yet on your to-do list, that absolutely can make all the difference.  Bring your child to a local estate planning attorney.

Kids going to college

You’ve probably focused on the fact that, having graduated from high school, your kid’s an adult now meaning that your child’s going to spread her wings.  But what is essential to remember: At 18, a college student may still want her mom and dad her side if she gets sick, but legally, decisions for medical care are hers alone.  If she was to say, unconscious from a serious car accident, a parent couldn’t authorize medical care without first going to court.  And it would be up to a judge, if her parent would be considered an appropriate guardian.

We don’t want to worry you, but the unfortunate reality is that, every year, some quarter of a million people between 18 and 25 wind up in the nation’s hospitals, according to Forbes, and their parents are often locked out of critical decisions.

Therefore, experts recommend that everyone over the age of 18 have a basic estate plan that includes a will or will or trust, a power of attorney, and medical directives that would allow someone they trust to take act on their behalf if they aren’t able to.

Here are some things to take care of before you send your kid away to college:

  • A FERPA Release: The Family Educational Rights and Privacy Act is designed to protect college student’s privacy, but it can leave parents locked out in an emergency.  A properly worded release allows school officials to talk with you and release your child’s records to you.
  • A HIPAA Authorization: The Health Insurance Portability and Accountability Act was designed protect a patient’s privacy.  Consider having your child signing an authorization so that – just in case – any necessary doctors can talk to you about your child’s condition, care, and treatment.
  • A Durable Financial Power of Attorney: This is a legal document that allows you to take care of your child’s checking or savings accounts, pay bills, etc., if the child’s unable to – whether due to illness or even just location (for example, if the school is on the other side of the country).
  • A Durable Power of Attorney for Healthcare: Like the financial version, this allows you to handle medical decisions for your child, if your child is unable to do so.
  • A Will: At first glance, this may seem a little silly for the average broke college kid.  But there could be a lot of hidden complexities: The average American has some 90 online accounts, for instance.  Does your child have thoughts about who should manage and close down those social media accounts?  Monitor emails?  Who should get the Xbox or a bank account?  It’s also a great time in your young adult’s life to instill responsibility by encouraging them to think about this early in life.

We’ve been helping families attain peace of mind for years.  Reach out to us today to protect your new college student and your family.

There’s Never A Better Time Than Now To Get Your Affairs in Order

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The idea of getting your financial and legal house in order is likely the last thing on your mind during the busy holiday season.  But, getting started is much easier than you think.  In fact, the end of the year is a good time to reflect upon the year that has passed and focus on your aspirations for the future.  Don’t hold this task off for later.  Some careful thought and a little bit of work now can go a long way to help you feel 100% confident about moving forward in the new tax year.

In preparation for the tax season, you likely have already begun gathering some paperwork, like you property tax bill, year end mortgage statement, or final pay stubs.  Although filing your income taxes is different than putting your affairs in order, you’re already in paperwork “mode”, so now is the perfect time to reassess your legal and financial situation to create a new plan or update an existing one that no longer suits your circumstances.

Basic Estate Planning

All you need to do is start with a general list of everything that you own.  You don’t have to complete a comprehensive inventory.  Think instead about categories of assets, like bank accounts, life insurance, real estate, vehicles, etc.

Then, draw out your family tree and think about who you would like to receive what you’ve spent your lifetime building.  If you don’t put your wishes in writing, your estate – everything you’ve worked so hard to build – may be liquidated and will be distributed according to the government’s plan, known as intestacy.

The foundation of all estate plans are wills and trusts.  Which one is the best for your depends on your individual circumstances.

A will is a written legal declaration of your intentions on how you want your property disposed upon death.  This document is not legally enforceable until after your passing and, therefore, it can be changed at any time before you die or have diminished mental incapacity.  A will allows you to control what happens after you are gone.

A trust is a legal arrangement where a trustee manages property for the benefit of the beneficiaries.  There are many kinds of trusts, ranging from living trusts to complex dynasty trusts.  Each type of trust has its own benefits and drawbacks, so talk with us about which one is the best fit for your circumstances.

Although there are many types of trusts, the one most people need is a living trust.  It’s a great alternative to a will, because it can be changed during your life, can provide financial protection should you become incapacitated, and yet often is easier and less expensive for your family to handle upon your death.  Another common type of trust is a testamentary trust, which is one that is contained within the provisions of the will.  Just like a will, a testamentary trust is not operative until your death, making them a little less flexible and more limited in function.

Benefits of Estate Planning

Estate planning can help provide financial stability for loved ones, designate a guardian for minor children or disabled family members, distribute property to chosen charitable organizations, reduce tax liabilities, and achieve other personal and family goals.  Organizing your financial and legal affairs is your opportunity to make impactful decisions on your assets, money, and healthcare and leave a legacy after you are gone.

Planning your estate may feel like a daunting task.  We’re here to help.  You don’t have to do this alone.  Call or contact us today to discuss your options and organize your future.