Bank accounts are a standard part of most everyone’s life. It’s a pretty easy concept, money goes in – money comes out. How it can affect your Survivorship Plan when you pass away is another story. It depends on:
1. how your accounts are set up.
2. how your family perceives they will have access to that money when you are gone.
As parents age, it is common to add a child or children to the account giving them the ability to write checks on the account to help in managing the money. It does not mean that they are joint “owners” of the account. In the financial and legal world, this is known as adding convenience signers to the account. As part of a comprehensive Survivorship Plan, one looks at how the costs for the funeral are going to be covered as well as funds available to settle unfinished personal business such as pay bills or miscellaneous expenses. You will be surprised to find out how controversial this can get among siblings trying to decide how a $10,000 funeral is going to be covered or how bills are going to be paid until an estate is settled. They naturally assume that access to that account will be there to cover these expenses. Not so says the Texas Probate Code, Section 438A.
d) On the death of the party, the cosigner shall have no right of survivorship in the account and ownership of the account remains in the party.
This means that the account is part of the estate and will be treated as such by the bank. Take note to visit with your bank and/or attorney to make sure this assumptions doesn’t trip your plans for your survivors.