Dangers to Avoid – Estate Disputes Created by Joint Ownership (James and Kathy’s Story)

James opens a joint bank account with his second wife, Kathy. It is joint with rights of survivorship. Whoever is the last surviving joint owner inherits what is in the account. No need to go through probate.

Almost $100,000 in the joint account came from the sale of James’s stock investments. He told his sons from his first marriage they will share the stocks under his will. James wanted his sons to use this gift to buy a home.

However, James died and Kathy inherited the $100,000 in their joint account outside of the will.

James’s sons, as their father’s executors, sued Kathy, claiming the joint account was set up just to avoid probate costs. Kathy could not inherit money that was intended for them, they claimed. However, Kathy said the money was put into the joint account to provide for her needs.

The resulting estate lawsuits ate up the estate. It cost much more than probate.

The Lesson

Complex estate issues often do not receive the planning attention they require.

You may be confident you will not create any conflicts. But what about your choice of executor?

Follow me through the next post and see.

Learn more about getting on the right track with your estate planning – read Breakthrough Estate Planning: Finding All the Answers You’ll Ever Need.