Scratch Below the Surface before Using Joint Accounts
There are times when you may hear someone make the case for a simple solution to a complex
problem and find yourself buying into this self-styled notion. When it comes to estate planning, you
would do well to scratch below the surface and think long and hard before adopting pseudo-solutions
that may be too good to be true.
One of the estate planning myths that circulates is the idea that you can circumvent the need for
proper estate planning by adding a co-account holder to your bank account or accounts. As the story
goes, you tell this individual how you would like the assets that remain in the account distributed
among your heirs after your death.
Since this person is a co-account holder, he or she has direct access to the funds, so it is true that this
individual would technically have the ability to carry out your wishes after you pass away.
However, this direct ownership is actually a very serious problem while you are still alive. These
resources are the property of your co-account holder just as much as they are your property.
Therefore, creditors or claimants could target these funds if they had a case against your co-account
We would all like to think that anyone that we would entrust in this manner would never betray that
trust. However, there are no guarantees with regard to the actions of your co-account holder.
And even if this individual would never abscond with the funds, he or she could fall victim to some
type of scam or other form of elder financial abuse.
And finally, Medi-Cal eligibility can be a factor. Let's say that your co-account holder wanted to apply
for Medi-Cal as a way to pay for long-term care. The resources in the account would be seen as his or
her personal property and this could cause a delay in eligibility.
The bottom line is this: joint accounts are really not a viable solution. There really is no substitute for
proper legal guidance when you want to arrange for the transfer of your assets to your loved ones
after you pass away.
Experienced estate planning attorneys Campbell CA of the Law Office of Roy W. Litherland offers
estate planning and business planning resources to residents of Campbell CA. To learn more about
these free resources, please visit www.attorneyoffice.com/ today.