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  • Tom Lewis

Joint Bank Accounts: Estate Planning Made Easy, Or A Recipe For Conflict?

Article by: Kyle Dickerson

Many people see adding a child as a joint owner to a bank account as a simple and convenient way to both plan for incapacity and transfer property outside of probate upon death, but there are several significant drawbacks to joint ownership that you should consider before signing that signature card.

When a financial account is set up for multiple owners as joint tenants with right of survivorship (commonly referred to as “JTWROS”), each person has equal ownership rights with access to the entire account balance, regardless of who contributed the funds.  Sadly, this sometimes results the intentional misappropriation of a parent’s money for the child’s own purposes.  There are also situations where factors outside the child’s control result in a loss of the parent’s funds, such as when a child has creditor issues, gets divorced, or is sued. 

When the primary account owner dies, his or her interest in the account immediately ends and the recently added joint account owner becomes the sole owner of the entire balance in the account.  This can lead to a situation where there are no funds available to cover the deceased’s final expenses, including the costs of a funeral, medical bills, and/or taxes.  Moreover, if the primary account holder has other children who are not co-owners on the account, this could lead to an unequal division of the primary account owner’s estate at death.  While the primary account owner may have expected the surviving joint account owner to share the funds equally with his or her siblings, there is no guarantee this will happen.

It is also possible that the child added as joint owner becomes incapacitated or dies during the life of the primary account owner.  If this were to happen, the primary account owner’s plans to avoid guardianship and probate would be lost. 

Joint accounts do have their benefits and can work well as a component of a comprehensive estate plan; however, wills, trusts and durable powers of attorney are much better planning tools.  These instruments can achieve the same primary objectives of managing a senior’s assets during incapacity and distributing assets to the next generation at death without putting the primary account owner’s assets at risk or leaving things to chance.  

Talk to an experienced estate planning attorney to learn more about the best way to protect yourself and your family as you plan for the future. 

The information in this Article is provided solely for informative purposes and is not intended to be legal advice nor relied on for any legal purposes.

Sumrell Sugg, P.A. is a regional legal firm that provides clients with first-rate services in a cost-effective manner. Whether clients are individuals, corporations, or local governments and municipalities, our firm delivers on an undeviating promise of service. For more information, visit us at

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