Should I title my financial accounts jointly with my child? by Jesica L. Thorson

This is a question elder law attorneys get asked frequently. However, this should not be done quickly and without careful consideration. Many parents want a child joint on their financial accounts so the child can help with their financial management if they are incapacitated. As a joint owner, the child can withdraw money from the account, write checks to pay bills, or make deposits to the account. However, as a co-owner of the account, the child may withdraw all the funds at any time for themselves. Or you could be exposing your funds to your child’s creditors or possibly to the child’s divorcing spouse.

An alternative to co-ownership is a financial power of attorney. This allows the parent to designate the child as attorney-in-fact and confer upon the children the power to handle banking and other financial matters. When acting as attorney-in-fact, the child is only acting as an agent for the parent and has no ownership in the account, and there is no exposure to the child’s creditors. The parent retains sole ownership of the account, and upon the death of the parent, the account will be divided as provided in the parent’s estate plan.

This is not to say that it is never appropriate to make a child a joint owner of an account with a parent, but you should carefully consider if this is appropriate for your family.