Why Adding your Adult Child as a Co-Signer To Your Bank Account May Not Be the Best Plan
I often hear people say, “Can’t I just add my child’s name to my bank account?” However, in this situation, many people do not recognize the liabilities involved with this decision and that there are other more viable options available. Most of the time when you add a child to your bank account, you are adding them as a joint owner of the account, which is not a great idea for a variety of reasons. As a co-owner of the account, they are unrestricted in what they can do, meaning that they can write checks off the account, and make deposits and withdrawals without having to ever consult with you. Remember, the person you add to the account will have the same rights and ownership of the account as you do. Even if you trust your child with joint ownership of the account, other liabilities can come into play with this scenario. For example, if your child gets sued – your money is now on the table. The good news is there are different options available. For example, adding your child as an agent under a Power of Attorney or adding them as a designated beneficiary to the account are both safer options. If you are interested in further discussing these other options, I invite you to schedule time on my calendar through the button below!