Are you a senior in Essex County or Middlesex County who is contemplating adding an adult child to your bank account to help manage your finances? It may seem like an easy solution for getting assistance with bill payments, but it’s crucial to weigh the pros and cons before taking action. Here at our Beverly, MA estate planning law firm, we understand the importance of making informed decisions, and we’re here to guide you through this process.
The Benefits of Adding an Adult Child to Your Bank Account
- Convenience: Adding an adult child to your bank account can make financial management easier. They can help with bill payments, monitor transactions, and address banking issues on your behalf.
- Emergency Preparedness: If you become incapacitated, having an adult child on your account allows them to immediately access funds to cover your needs.
- Avoiding Essex or Middlesex County Probate: Funds in a jointly owned bank account typically pass directly to the surviving owner, bypassing the probate process.
Meet Mrs. Jenkins
Let’s take a look at Mrs. Jenkins, a 78-year-old widow who has been struggling with managing her finances due to declining eyesight. To address this, she decided to add her son, John, to her bank account. This arrangement has allowed John to conveniently handle her bill payments, manage her investments, and ensure her financial needs are being met. However, it’s important to note that adding an adult child to a bank account does come with potential pitfalls.
Potential Drawbacks of Adding an Adult Child to Your Bank Account
- Exposure to the Child’s Financial Risks: Once added to your account, your child’s creditors might be able to seize funds to settle their debts.
- Family Conflicts: If you have multiple children, adding only one to your bank account may lead to disputes or strained relationships among siblings.
- Unintended Consequences on Your Estate Plan: The funds in your joint account may pass directly to the joint owner upon your death, potentially disrupting your intended inheritance to your family.
The Unintended Consequences Mrs. Jenkins Faced
Let’s consider Mrs. Jenkins’ situation further. After she added her son to her bank accounts, an unforeseen event occurred—the pandemic. Unfortunately, her son’s relatively new business venture failed, and his creditors turned to his personal assets, including his mother’s bank account, to recoup their losses. This unexpected turn of events caused financial distress for both Mrs. Jenkins and her son.
Before making the decision to add an adult child to your bank account for assistance with financial management, it’s crucial to consider these pros and cons. It’s also worth exploring alternative options, such as setting up a power of attorney or creating a revocable living trust, which may accomplish your goals with potentially fewer risks involved.
At our Beverly, MA law firm, our experienced attorneys can provide personalized advice tailored to your unique situation. We’re here to ensure you make a decision that best protects your assets and your family’s future. To discuss your circumstances and navigate this complex decision, please contact us at the Bernstein Law Group, PC at (978) 825-0033. We’re here to guide you every step of the way.
Remember, when it comes to managing your finances and safeguarding your assets, knowledge and careful consideration are key.