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Does the Surviving Joint Account Owner Take Over the Entire Interest Upon Death?

Many would prefer to set up joint accounts as a way to guard against the contingency event where one family member passes away, and the other family members cannot get access to his or her money.

If we had setup up a joint account with our spouse or one of our children, in the event we passed away, the surviving joint account holder will own 100% of the monies in the joint account. The money will not be subjected to the probate process of the deceased joint account holder. The probate process is a legal process of distributing an estate according to a will.

The joint account has also become a critical method for holders of stocks incorporated in countries with high death/inheritance taxes to bypass those taxes.

The Sunday Times has a good summary of 4 things we should take note of about joint accounts:

Click to read in a larger format.

Ms Sim, head of a specialist and private client disputes practice, explains that a joint account is less ironclad when disputes are brought up.

Here are the essential points I picked up:

  1. Joint owners have unity of interest over the entirety of the account and the right of survivorship. On the death of one joint owner, his rights to the joint account are extinguished, and the surviving joint owner takes an entire interest. – High court judge Choo Han Teck
  2. Whoever contributes more money will matter in cases of dispute. Beneficiaries can prove the main contributor had not intended his money to go to the survivor. The joint owner may not claim rights of survivorship.
  3. Relationship matters. If the joint owners are a couple, they are deemed to own the money jointly. In the event of death, the surviving spouse will become the sole owner.
  4. Suppose you are in a less legal relationship, such as a boyfriend and girlfriend relationship. In that case, it is better to make a will to state explicitly your intention for the surviving holder the right of survivorship of the money if that is the intention.
  5. Ms Sim makes two suggestions:
    1. Suppose there is no legal relationship between the two, you should create or put in the will explicitly to make clear the intention to give the money to whoever if that is the wish.
    2. If you open a joint account out of convenience and do not wish the relative to benefit, you should clearly state in a will.

The idea is not to leave it to chance for dispute and clarify your intention.

If most relationships are amicable, then usually there are no problems, but it often gets messy when a lot of money and deep-seated family relationship problems clash.

A good estate lawyer would ask you to explicitly state your intention for your joint accounts in the will, even if it feels weird. The lawyer is doing what Ms Sim suggested.

You should know your family relationship well. If relationships are hard to fix, make sure you do up a will and state your intention clearly.

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Lester Chan

Monday 12th of September 2022

It depends on whether the joint account is with joint AND or joint OR. For joint AND, it might still need legal docs. For joint OR doesn't need though sometimes the branch CS might not be educated on the difference and when you submit a death cert, it go ahead and froze the account.


Tuesday 13th of September 2022

Hey Lester, I think for both, you can still freeze and close the account. However, what I mean is legally, are you doing the right thing with the money. When we take the money and close the account, we are doing the role of an executor, but we still need to execute in accordance and the question is whether the other half of the money should be the surviving spouse or not. The line seems to be clear (should belong to the surviving spouse) but if its not a spouse relationship, it is up for contention. Let me know, if you understand this but still think what you say matters.

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