Accounts and Naming

Is it usually best to have both the husband and wife on most accounts? For example, if one person passes away what happens to an account in both parties’ names? Does it stay as is? Does the bank or brokerage close/transfer it to a new account just in the surviving spouse’s name?

Just trying to figure what is easiest in the event one of us is no longer around. On the accounts where we only have one name, we are listing the other person as beneficiary (although in many/all cases this is probably not necessary since it usually defaults to the surviving spouse).

Thanks.

Is it usually best to have both the husband and wife on most accounts? For example, if one person passes away what happens to an account in both parties’ names? Does it stay as is? Does the bank or brokerage close/transfer it to a new account just in the surviving spouse’s name?

If you want the other spouse to have complete access to the account, get the full amount of the account at the first to die, no tax planning and no creditor issues, then yes use joint tenancy with rights of survivorship. They shouldn’t need to transfer the account, but different institutions may have different procedures.

Just trying to figure what is easiest in the event one of us is no longer around. On the accounts where we only have one name, we are listing the other person as beneficiary (although in many/all cases this is probably not necessary since it usually defaults to the surviving spouse).

Joint accounts allow access to the account by either person. If one becomes incapacitated, the other can access. Plus, either person can empty an account at any time. Pay of Death accounts are different. Only the owner can access the account (or their agent) or change the beneficiary. The beneficiary’s only right is after death to collect (relatively easily) the account assets. Unlike a joint account, a new account would need to be created if assets are to remain at that institution.

Joint account with rights of survivorship and POD accounts avoid probate (and creditors of the estate) - for better or worse. So, there is a difference.

I’ve pitched it before, but I’ll pitch it again - “Death is No Excuse” by David Baker is a good read on many of these issues. It isn’t a DIY book, but it gives you a great overview of the area in a very readable way.

Mike

Do you trust them?

It’s best to have accounts, houses, cars in both names. Funds go to survivor, house to survivor, .etc. upon death and any issues easily resolved with a death certificate.

For a first marriage or maybe a second one with no kids.

If you DO have kids and this is spouse 2 you might want a will or living trust to be sure what remains goes to the kids after the second partner passes. Like “they can live in the house until they die then my kids, not theirs, inherit my house”.

So it gets more complicated if it’s a second marriage. Where do you want things to go if you die first? Ditto from the other side.

I would check with the rules in your state - community property states may be different.

From my experience, it was good to have some money and credit cards in each name separately. Things can get messy after a death and bills will continue. There were also be new ones and particularly before receiving a death certificate, it’s easier just to have some money in a single name.

Incapacitation can also make things interesting.

Was there a prenup ? That can also inform this.

Our bank accounts were in both our names. This was a Very Good Thing as I was simply able to take over paying the bills.

Well, not so simple really. My wife payed the bills using the bank’s bill pay service, which was great for her. She even had the electric bill going to the bank and set up to be paid without her doing anything. The catch? Everything she had set up was associated with her login to the bank’s on-line system. That is to say, to her personal login, not to our checking account. My bank login did not get me access to her bill pay setup! Fortunately I had her bank password and was able to get on as her, copy the most important information, and set them up all over again.

Charge cards… One was in my name, the others in hers. I had to close hers and set up a new one for my main card. Fortunately the hit against my credit from all these things was only maybe 50 points after the dust settled.

Her car was in her name only. We were already selling it, and one of her last acts while in hospice was to sign the title so it could be sold two days before her death.

(An aside for everyone’s amusement. We never wrote a lot of checks, and I was still using ones with both our names on them a couple of years later. Though we has plenty more on hand I finally ordered checks with jut my name. When I unexpectedly bought a new house a couple of months later, and changed address, I had to buy new checks again, and this time I did not wait. More checks for the shredder.)

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Thanks. I waited until late in life to get married for the first time. Neither of us have kids or ex-spouses to deal with. Sounds like in most cases it is best to use both names. The last thing I want my wife to deal with is trying to figure out how to get access to money if I’m temporary or permanent incapacitated.

My father passed away back in early December and it has been an eye opener as to what can go wrong even though he was quite detailed in getting things organized and simplified. It took nearly 8 weeks to get a death certificate due to a computer hack of the health department and then the state flags certain forms of death and in my father’s case one of the causes was flagged which required further investigation. It just slowed everything and you get to a point where you just want to get things over with.

My wife has been doing the name change thing and that has taken much longer than she expected.

Thanks.