Joint ownership with a right of survivorship, or joint tenancy, is a common method of owning assets. Particularly with husbands and wives, it is a very common ownership method. Many people hear about joint tenancy as being a good estate planning tool – a way to transfer their assets to a loved one without court probate and without spending money on attorney’s fees.
Joint tenancy is a good tool, but it can also cause problems. For instance:
- If you put a child on your house as a joint tenant, and your house may be at risk later if your child gets divorced or goes bankrupt.
- If you name your 2nd spouse as a joint owner, you risk having your assets go to their family (step-kids) instead of your own family.
- If you put inherited assets into a joint account with your spouse and later get divorced, you may be fighting over whether that was considered a gift your ex-spouse gets to keep.
There are many “simple” estate planning solutions floating around out there. We sometimes like to refer to them as coffee shop estate planning, because they are informally passed through conversations with friends and neighbors. But unless you consult with an experienced estate planning attorney, these “simple” solutions can cause big problems for your family down the road.
To learn more about the basics of estate planning, we encourage you to check out some of the following resources on our website:
If you’re ready to get started planning today, give us a call at 217-726-9200 to schedule an initial meeting.