Justin, I am listed as Payable on Death (or P.O.D.) on my mother’s bank account. However, the bank told me that this does not give me access to my mother’s funds until she passes away. What if I need to access the funds in her account to pay her medical bills or other expenses while she is still living? Would it be better for my mother to add me as a co-owner on all of her accounts? – Sue
Sue, Generally, I do not recommend that parents add their children as co-owners on bank accounts. When a child is a co-owner, if someone sues the child, the parent’s funds would also become part of that lawsuit. The same applies if the child goes through a divorce or bankruptcy.
However, as an Elder Law Attorney, I understand that sometimes it would be very useful for a parent to give one of his or her children access to bank accounts. If your mother is still able to sign legal documents, then I recommend that she appoint you to be her agent under a Power of Attorney rather than a co-owner.
A Power of Attorney document allows your mother to appoint someone else to act on her behalf when needed. You or your mother can then take a copy of her signed Power of Attorney to the bank, and the bank will list you as POA (Power of Attorney) on the account. Being POA on an account is different from being a co-owner. It provides the benefits of being able to access funds to care for your mother but removes the risk that unexpected trouble in your life will cause trouble for your mother. This is because, as POA, you are acting as a representative for your mother while she remains the sole owner of the funds. The Elder Law Practice prepares comprehensive Power of Attorney packages designed to address this very situation.