Washington probate and estate planning attorney Tom Oldfield discusses whether or not you should have a joint bank account and what that means for you.
A lot of people think about what will happen when they are unable to make their own decisions. As probate and estate planning attorneys, we fully understand the plight of a family as the choose power of attorney and make living wills. What a lot of people don’t think about it the practical things, like bank accounts. What about your loved ones money to pay bills and survive? Who will handle all the financial questions? Did you know that banks actually attach a right of survivorship to joint accounts now, allowing the other party to take over financial control if the partner dies? It’s important to understand your options with joint bank accounts and if they are the right decision for you. Watch the video now to learn more.
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Oldfield & Helsdon, PLLC
1401 Regents Blvd., Suite 102
Fircrest, WA 98466
Merge Vs. Separate Accounts in Marriage - as part of the expert series by GeoBeats.
I think it is really important that couples merge certain parts of their finances. And the most important one is to merge their daily living expense account. In other words the account that you pay your daily bills out of should be a merged account. And, what I recommend is that each person, and, Iam assuming both people are working, is that you both agree on the amount of money out of your pay check you are going to put into that merged account for the bills.
Let's say, your wife is making more than you, or, your husband is making more than you. I would say it is fair to have that person put a bigger percentage into the daily living, daily bill expense account than the person making less money, make it fair. And, then, so, you are both equally sharing in the expenses.
Okay, then I also recommend that married couples have a joint investment savings account. They also agree how much they are going to put in. Maybe this is not an every month thing, maybe this is, you know, two times a year you decide how much you are going to put into your investment savings account. That is not a retirement savings account. So, you are building wealth together in an investment account.
Then, third, if you, I recommend if you had separate investment accounts before you were married, then you keep them separate. And, why is this? Well, unfortunately, you know the divorce rate is high and if you merge your personal money, at least in community property states, it becomes joint money, and, it may be an unfair split in case of a divorce.
It does not mean to say that you cannot have your spouse be the beneficiary on that investment account. You can fully plan to share it when you want to, when you want to merge some of your money in the joint account, that is fine. But I would keep the accounts that you had before you were married, separate.
Then, of course, retirement accounts are always separate, you own those individually, those are not merged. And, then, you can add your spouse as a beneficiary. To me, this is the most equitable way to combine finances, and specially now when usually there are dual earning couples. People are getting married later in life. They have accumulated assets. I think this creates a good feeling between the couples.