There is a common misconception that adding someone’s name to your accounts provides similar benefits that a Power of Attorney for Property does. Plain and simple, it does not and is not an okay substitute. A Power of Attorney for Property will provide more powers and may even, as you will see in this video, protect your money from a financial burden that isn’t your own.
In this Elder Law Minute video, Wes Coulson, Illinois Elder Law attorney, explains the benefits of having a Power of Attorney for Property in place and why it is a better option than simply adding someone’s name to your accounts.
Is adding someone’s name to your accounts an okay substitute for a Power of Attorney for Property?
Hi, I’m Wes Coulson and this is your Elder Law Minute. One of the wrong things that I hear a lot, that kind of drives me a little bit batty, is people will say, “Well, I don’t need to have a power of attorney for property, I’ve got my daughter’s name on all of my bank accounts.” Well, that may sound good at first, but let’s talk about what happens at the point where you are incapacitated.
First, let’s talk about, you know people say, “Well, my daughter could pay the bills.” Yes, but what if you get a bill in for $1,000 and it’s really only supposed to be for $100. If your daughter calls to complain, they don’t have to talk to her unless she has power of attorney. She could write the check for $1,000, but she can’t argue whether that’s the correct amount of the check.
If anything happens bad financially to your daughter and her name is on the accounts with yours, all that money is up for grabs. You could lose everything in the accounts, in your accounts, because they’re her accounts to pay her bills.
If anything needs to be done with real estate, unless you’ve put her name on the real estate, which could be a bad mistake, she can’t do anything.
And I’ll guarantee you if you have any IRAs, you can’t put your daughter’s name on the IRAs. The “I” in IRA stands for individual and doesn’t mean you and your daughter.
So, for a lot of reasons, please don’t do that. You need to have power of attorney for property in place. Thanks.
For more about Powers of Attorney, visit these articles:
- Common Estate Planning Mistake #9: Failing to name enough successor agents under a Power of Attorney for Property
- Common Estate Planning Mistake #7: Failing to include enough powers in a Power of Attorney for Property
- Why a Healthcare Power of Attorney is Better than a Living Will
- The $20,000 Power of Attorney
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Coulson Elder Law is dedicated to providing families in the St. Louis area with their Elder Law needs. Our practice areas include Asset Preservation Planning, Veterans Benefits, Medicaid Eligibility, Alzheimer’s Planning, Special Needs Planning, Estate Planning and more. We understand the financial challenges you may face as you and your loved ones grow older. At Coulson Elder Law, our clients’ well-being is our number one priority. For immediate help, call (877)995-6876 or Contact Us and we will get in touch as soon as possible.