As your child turns 18, they’re entering a new phase of life—legally and personally. This transition often comes with greater independence, new responsibilities and important decisions, whether they’re starting college, joining the workforce or simply embracing adulthood at home. No matter the path, there are several legal considerations you and your newly minted adult should keep in mind.

18-year-olds are legally independent

Once your child turns 18, you as a parent no longer have automatic legal authority to make decisions for them or to act on your child’s behalf. Healthcare providers, financial institutions and other businesses may legally refuse to discuss your child’s situation and leave you without recourse to provide assistance. However, as long as your young adult can articulate their wishes, they may state them in documents like Health Care Directives and Powers of Attorney to name you or other agents to help manage their affairs if they are ever unable. 

1. Health Care Directive

This document allows your young adult to appoint someone—typically a parent or close relative—to make medical decisions on their behalf if they are unable to do so. The person making the Health Care Directive is the “Principal” while the appointed person is the “Health Care Agent.”

When Does a Health Care Directive Become Effective?

As long as the Principal is able to communicate with physicians, they are able to make all medical decisions for themselves. In the event that the Principal cannot make or communicate their medical decisions, then the Health Care Agent may make medical decisions on the Principal’s behalf.

Powers that a Health Care Agent May Delegate

Health Care Agents have broad powers to make health care decisions when acting on behalf of the Principal, including consenting to treatments or services, choosing provisors, determining living locations and accessing medical records.

The Principal, however, is able to limit the scope of these powers by listing specific directions in the document. The Principal may list specific directions regarding after-death issues such as organ donation wishes or burial or cremation decisions. The Principal is also able to give specific instruction on the level of end-of-life care that he or she wishes to receive, spanning from authorizing invasive procedures to instituting a do not resuscitate (DNR).

Duties of the Health Care Agent

A Health Care Agent must make health care decisions for the Principal based on the instructions provided in the Health Care Directive. To the extent that the Principal’s wishes are unknown, the Health Care Agent has a duty to act in the Principal’s best interest.

These are heavy issues for anyone, let alone an 18-year-old. But as with most estate planning matters, investing upfront effort and thought can spare families from doubt and heartache.

Changing Circumstances

Like many estate planning documents, a Health Care Directive should be reviewed and updated with changing circumstances. It is typical for young adults to have a Health Care Directive that lists parents or close relatives as their Health Care Agent. As life progresses, it is typical for new Health Care Directives to be drafted to conform to changing life circumstances, such as with marriages, moving to new locations, or having adult children of their own who may serve as Health Care Agents.

2. Power of Attorney

A Power of Attorney is granted by a “Principal” to authorize a designated person (the “attorney-in-fact”) to handle legal and financial matters on the subject’s behalf. This can include managing bank accounts, signing leases, paying bills, or handling tax matters. It’s easy to imagine circumstances in which a college student may still want a parent to step in for these issues—they might be studying abroad, busy with school, or, god forbid, incapacitated.

There are two general types of Power of Attorney documents in Minnesota:

• Statutory Power of Attorney

The Minnesota Statutory Power of Attorney Form is a default form created under Minnesota law. Even though it is a default form, it is highly customizable. The Principal may decide to delegate powers regarding real property transactions, tangible personal property transactions, banking transactions, business transactions, and a host of other powers. The Principal may also check a box to include “all powers.”

The benefit of the Statutory Power of Attorney is that it is the industry standard that most banks and financial institutions are comfortable using and understand. Further, Minnesota Law provides additional protections, such as presuming that the Statutory Power of Attorney is valid and that there may be penalties for an institution refusing to accept the document.

• Common Law Power of Attorney

The other general type of Power of Attorney document is the “common law power of attorney.” This power of attorney is more customizable but does not have a standard form beyond the formal signing requirements.

When Does a Power of Attorney Become Effective?

Power of Attorney documents may be effective upon all necessary signatures, or may be effective upon only a contingency (called a “Springing Power of Attorney”). While there are situations where one may be more beneficial than the other, my standard practice is that if you pick someone you trust, a Power of Attorney document that is effective upon all necessary signatures does well in many circumstances.

Duties of the Attorney-in-Fact

The attorney-in-fact owes fiduciary duties to the Principal. The attorney-in-fact generally has broad access to the Principal’s finances; and in return for that broad authority, the attorney-in-fact must act only for the benefit of the Principal and keep adequate records.

Advance planning is an act of responsibility and care

As your new adult is experiencing, turning 18 brings independence, but it also requires responsibility. By completing their Health Care Directive and Power of Attorney, your loved one can avoid confusion, protect themselves, and ensure that an agent may step in to help when it matters most.

Larkin Hoffman regularly helps families navigate these important legal transitions. If your child has recently turned 18, now is the ideal time to talk. Contact us if you’d like an experienced advisor to help ensure your legal documents reflect the new reality of your young adult.