“Mistitling of assets is one of the prominent causes of failed estate plans,” asserts Avani Ramnani, CFP®, director of financial planning and wealth management at Francis Financial, a wealth management firm in New York. What might go wrong? As an example, Daniel Timins, CFP®, an estate planning attorney in New York, says that one critical aspect of titling that has led to a “shocking number of legal disputes” is whether an account is titled joint tenants with right of survivorship (JTWROS) or a mere “convenience account.”
The website financialplanning.com recently posted “Titling Mistakes Can Disrupt Estate Plans,” which discusses the situation where an elderly parent may title a bank account as JTWROS with an adult child who can help with paying bills if the parent is unable to handle his or her own affairs. When the parent passes away, the balance in that account will go to that child. If the parent was thinking of giving the surplus to all other children, this will not take place with a JTWROS account.
A convenience account is strictly for situations where one owner wants another person to have access to funds to pay bills, such as with an elderly parent. Many states allow these convenience accounts that let someone use the funds for the original owner’s benefit, but the convenience signer doesn’t own the account.
Convenience accounts do not pass to the other owner at death. The account can lead either to a future probate of the account or the convenience owner walking off with the funds because he thinks he deserves them.
Creating a JTWROS account to help an elderly person may lead to family issues. It isn’t uncommon to see an adult child assisting his or her parents with their finances as they get older, but families need to exercise caution when they consider retitling accounts.
As an example, one daughter wanted to be put on all of her mother’s accounts. This would’ve created a potential issue at the time of passing. Even worse, it could precipitate theft or misappropriation of the funds. The family should use a power of attorney instead. A power of attorney ceases at death, so the family would have to file with the court to get to any open accounts after death.
Consult an experienced estate planning attorney before adding a non-spouse to any account.
Reference: financialplanning.com (August 27, 2015) “Titling Mistakes Can Disrupt Estate Plans”
“On the threshold of retirement, we finally decided to quit thinking we could self-prepare the requisite documents. We had previously had only a very simple will. We needed the necessary legal (including updated will) & health care docs but didn’t want to deal with the time & complication of legalese. Cindy made the process relatively painless. She took the time to explain and answer questions without trying to upsell services. We were done in 2 meetings plus the reading of emailed drafts. In addition to preparing the documents, Nelson Eldercare will be there when our adult children need advice on executing the plans we’ve put in place.So glad it’s behind us and would recommend Cindy and her helpful staff.”
Cindy and her company treat their clients like family. Nelson’s offers clear, direct, and honest guidance in planning for your families security and future. No one wants to actively sit down and make these decisions, but Nelson’s makes this process seamless. I was so impressed with their willingness to answer all questions big or small. So glad I made the decision have them help my mom and dad and now me. You can’t go wrong with Nelson’s Elder Care Law.
The very best elder law attorney and staff anyone could ever ask for! I have referred a number of clients to Cindy and she never disappoints. She is kind, caring, and extremely thorough in making sure everything is completed as it should be. I highly recommend Cindy for anyone needing lawyer services; she truly goes above and beyond for every client she helps and has had a huge impact in so many peoples’ lives. Thank you, Cindy and staff, for everything that you do- I’m so glad to know you!
I heard Cindy’s presentation at a Senior Luncheon at my church, and was very impressed. She helped my daughter and me understand many aspects of elder law. Josh has also been very helpful in my planning to enter an independent living situation . I have told many friends about them.
Cindy and the Nelson Elder Care Law team are trustworthy and helpful. They are the experts in elder care law. At Leaf Cremation, we entrust our families to the care of the Nelson team when their services are needed.