Is Adding Someone To My Bank Account A Good Idea?

 

People often come in to do estate planning who have already taken steps to simplify their life as daily tasks become more challenging. A common step is to add a child or trusted individual to a checking or bank account to get help with paying bills, buying groceries, or other financial tasks. It seems logical and often accomplishes what is desired, but this simple action can have unintended results. When a person is added to an account, they become a joint owner of those assets. When one joint owner dies, the person still living automatically becomes the owner without passing through a Will or probate.

Thus, if a Will says to divide assets among three kids, but one child has been added to bank accounts for convenience, that child has been given everything in those bank accounts automatically when the parent dies. What a Will says makes no difference. Clearly, this is probably not the intention. To avoid this happening, it is best to have a power of attorney drafted. A power of attorney will allow this child to assist with various aspects of everyday life - financial and beyond - yet the person needing assistance still owns all their property and can pass it as they desire through a Will.

Kelley Scrocca
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Business Estate Planning and Probate Attorney