Joint Accounts with Adult Children – Helpful or Harmful?

By Laura Chiesman

As parents age their adult children often get involved to help out with day to day tasks including finances. Many decide to add a child or other relative as joint owner to their bank and investment accounts and sometimes other property. Before choosing this route, carefully consider these questions.

What Is Joint Ownership?

Arrangement where two or more persons share ownership of property. This allows someone else to have immediate access to your property and to use it (hopefully) to care for you if you become incapacitated.

What Are The Disadvantages Of Joint Ownership?

Joint Owner Has Complete Ownership
A joint owner completely owns the property with you and has total access to the asset. Therefore, this person must be someone you trust.

You Cannot Direct The Joint Owner To Use The Property For Your Benefit
A joint owner has the authority to access your property, but you cannot give, or require, the joint owner the power to act. There is nothing that forces the joint owner to do any task, such as use the property to support you, file tax returns, or make gifts.

Property Passes To Surviving Joint Owner
Joint property does not pass under your will, but transfers automatically to the joint owner. That joint owner has no obligation to pass these assets on to other heirs as you may have intended.

What Are The Advantages Of Joint Ownership?

Avoids Need For Guardianship
In the case of incapacity the joint owner can take control of your property and is able to reach your property without the need for court approval.

Simple To Create
You can open new joint accounts or change property titles to joint names. You can even do this yourself, although, if you intend to change a deed to real estate you may want to consult an attorney.

Inexpensive To Implement
Essentially no fees are involved with changing the title to your property or accounts. The joint owner is not entitled to a fee and the attorney’s fee for changing a deed and filing fee for recording the deed should not be prohibitive.

What’s Right For You?

There is often more than one way to reach a solution, but which is right for you? The best choice will depend on your particular situation, considering your relationships and the capabilities of others in your life. Durable power of attorney or a living trust may be better planning alternatives and this is a topic to review with your trusted advisors and estate planning attorney.

Decisions like this start with a conversation. The WealthCoaches™ at FirstWave Financial™ can help you get started. If you have questions or need help putting a plan in place, please call our wealth services firm in Satellite Beach, FL – Melbourne/Brevard area at (321) 773-7773 to schedule a complimentary consultation or visit us at

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