4 Things You Should Do When Your Child Turns 18

You still view him in a Buzz Lightyear costume, planning to go “to infinity and beyond.” But starting on his 18th birthday, everyone else — including the law — will see your child as a capable adult. While this legal change happens literally overnight, the transition to adulthood will probably be more gradual.  

Legally, once your child turns 18, a lot of things change, and that can be a tricky time, says Dan McLennon, senior attorney with the Northwestern Mutual advanced planning team. “It’s an in-between period — while they are technically an adult, they don’t yet have their own family, and many times are still an everyday part of yours.”  
 
And for many parents, that means continuing to support them. That’s why the month before they turn 18 is a smart time to sit down and discuss some very grown-up paperwork. Here are four topics you may want to cover.  

1. MEDICAL POWER OF ATTORNEY

   You never want to imagine something bad happening to your child, but it’s crucial to be prepared. Once your child turns 18, if he or she gets into a car accident and needs someone to make medical decisions, you won’t be able to unless you've signed this document — even if your child is still on your insurance. Doctors may not even be willing to discuss your child’s condition if you don’t have this in place. Ultimately, a judge might have to make decisions about your child’s care.

   While discussing “medical decisions” might seem like an invasion of privacy to a headstrong teenager, McLennon recommends broaching the subject by explaining why it’s in their best interest. “For all your life we’ve been able to make decisions in your best interest. But now, if something were to happen to you, without this document we wouldn’t have control over what procedures were done or even be privy to information on your condition.”
    

2. DURABLE POWER OF ATTORNEY

   While the medical POA allows you to access their medical information, this document grants you the ability to act on their behalf in financial and legal matters. This can come in handy if you still handle any of their financial needs (it would be nice to be able to continue checking their bank accounts, right?) or in case you need to do something like send them a new passport while they’re studying abroad.

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   You can find free forms online for both the medical and durable power of attorney or access them via your lawyer. Different states have different rules regarding whether they need to be notarized. If your child lives out-of-state, it’s safest to get forms for both states.

3. THE FAMILY EDUCATIONAL RIGHTS AND PRIVACY ACT (FERPA) WAIVER

   If your child attends college, you might be footing part of the bill, which you’d think would give you access to their educational records, including their grades. You’d be wrong. That’s why parents might want to consider having their child sign a FERPA disclosure. Many schools also offer the option for students to allow parents to access their records through the online student portal.
    

4. UNIFORM GIFT TO MINORS ACT (UGMA) OR UNIFORM TRANSFER TO MINORS ACT (UTMA) ACCOUNTS

   Many parents establish these custodial accounts for their children as a way to make investment decisions and potentially achieve some tax benefits. However, some states turn this money over to the child at the age of 18 (other states are 21, so check with yours). Check with the firm that holds your account, and if your state bequeaths the money at 18, well, the money is theirs to do with as they please, says McLennon. Of course, this provides the perfect segue to initiate a talk about financial matters.