Avoiding Unintended Outcomes

Commonly, a standard joint account owner arrangement is used to help. This is essentially the addition of another person as a joint owner on a checking account. However, this arrangement:

  • Does not provide any protection from financial exploitation
  • It increases the possibility of fraud and/or abuse
  • Includes no legal obligation to look out for the best interests of the original account owner – no third party oversight or accountability is included

A person’s estate plan can also be affected if account titling is not handled properly. A standard joint account owner arrangement allows either party to withdraw all or a portion of the funds. This sounds convenient, however:

  • Upon the death of one of the account owners, the surviving owner will automatically receive 100% of the account regardless of the decedent’s estate planning documents dictating otherwise

To provide protection for both the financial caregiver and care receiver, several different legal documents can be used to designate specific powers for the caregiver to exercise.

  • In all cases, the legally appointed financial caregiver has an obligation to act in accordance with the directions as written and also in the best interest of the person for whom they are acting.
  • When proper documents are not prepared in advance, it may be necessary to establish a Court supervised guardianship.
  • In the guardianship process, the Court provides very detailed instructions and guidance for the use of the Ward’s assets.

Learn more about understanding the legal documents. 

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