Once an additional name has been put on the account,
usually both signatures will be required to formally close the
account and, especially with securities, on letters of
instruction. Therefore, this form of title should be used only
when your "partner" (whether a "sig- nificant other" or
spouse, a business associate, a parent or adult child) is
absolutely trustworthy and the relationship is very secure.
Your decision will also depend upon whether you want this
individual to be able to perform banking and other business
transactions on your behalf and if your s/he has your written
authorization to do so.
Third, merely because an account bears more than
one name does not mean that the parties have any rights-of-
survivorship. Be forewarned that in the absence of an
express designation of "joint tenants with rights-of-
survivorship" (JT/WROS) on the passbook, signature card,
or other documentation for the account, your bank's written
policy and state law will determine what type of account you
have established; you may have inadvertently created a
"tenancy-in-common" with your "partner." This type of
ownership retains the same problems noted above without
converting the account into non-probate property. If you do
not know for sure, then check with your bank to determine
the status of your accounts.
Lastly, common ownership presents a potentially
serious liability problem. For purposes of this discussion,
"common ownership" is intended to mean the ownership of
property by more than one natural person whose collective
interests in the prop- erty remain outside of any protective
environment provided by certain forms of enterprise, such
as limited liability com- panies, limited partnerships, or
corporations. Whether or not the asset is titled in a
survivorship form, and regardless if it is real or personal
property -- all of the property may be seized to satisfy a claim
by a judgment creditor against a joint-tenant. (An exception
applies to property held by husband-and-wife as "tenants by
the entireties." In Ohio, even spouses who are transferees of
real property may no longer receive title as tenants by the
entireties.) As a practical matter, then, before adding
anyone's name to an account of yours, you should assess
carefully whether the prospective co- tenant owns sufficient
assets to meet any substantial debt which may be incurred
(e.g., from gambling, health care expenses, spending
sprees, etc.) if not adequately covered by personal liability or
other insurance.
The estate planning tools noted above normally do
not require any documentation other than the wording of the
asset's title. They are easy to implement, but are not totally
without risk. Although it is possible to put all of your
property in non-probate form, do not overlook the remaining
need to have a last will in order to nominate an executor and
waive bond, and to appoint guardians for minor children.
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