It’s very common for parents to add an adult child to their bank accounts — sometimes to make bill-paying easier, sometimes as part of an estate plan. But what actually happens to those accounts when the parent passes away? And if everything goes automatically to the child, what’s the point of having a will?
Here’s what you should know.
1. Joint Accounts with Rights of Survivorship
If you’ve added your child as a joint owner on a bank or checking account with rights of survivorship, then yes — when you pass away, that account typically becomes the child’s property automatically. The bank will usually only require a death certificate to remove your name.
Because these accounts transfer by operation of law, they do not pass through your will or your estate. Even if your will says something different, the joint ownership arrangement controls.
2. Authorized Signers and Powers of Attorney
Not all accounts with a child’s name attached are truly “joint.” Some parents add a child as an authorized signer or under a power of attorney, allowing the child to help manage funds during life.
In those cases, the child’s authority ends at death, and the money in those accounts becomes part of the estate, to be distributed under the will (or state law, if there’s no will). This is a common and important distinction.
3. Why You Still Need a Will
Even if your major accounts are jointly owned or have named beneficiaries, you still need a will. Here’s why:
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A will controls everything else — vehicles, real estate, personal property, and any accounts that are not jointly titled.
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It allows you to name an executor to handle debts, taxes, and final affairs.
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A will provides backup beneficiaries in case a joint owner or named beneficiary passes away first.
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It helps avoid unintended consequences, such as one child inheriting everything simply because they were added to a parent’s checking account.
Without a will, your state’s intestacy laws decide where your remaining assets go — and that may not match your wishes.
4. Planning the Right Way
If your goal is to make things easier for your child while you’re alive, consider giving them power of attorney instead of joint ownership. That allows them to help manage your finances without automatically inheriting everything.
If your goal is to make inheritance simple, you can use “transfer on death” (TOD) or “payable on death” (POD) designations. These designations allow assets to pass directly to beneficiaries after death, while keeping ownership solely in your name during your lifetime.
Final Thoughts
Account titling and beneficiary designations are powerful tools — but they can also override your will and create results you didn’t intend. The best approach is to coordinate everything as part of a comprehensive estate plan.
If you’d like help reviewing your account titling and estate planning documents to make sure your wishes are clear and legally sound, Gentile Property Law Office, LLC can help.
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