Apr 06, 2011

The Golden Rule: Dealing With Banks and Custodial Accounts

golden rule.jpgDear Liza, After petitioning a local county court, I was awarded legal guardianship of my mother due to her Alzheimer's.  Now I would like to open a custodial bank account for her so I can electronically pay her bills.  Some banks will allow me to designate beneficiaries of the account, thereby avoiding probate for the funds in the account.  Others will not allow this, saying my status as her fiduciary doesn't enable me to make decisions that "go beyond the grave," possibly contravening my mother's will, despite being able to produce her original will to show that the beneficiaries are in accordance with her wishes.  What is the correct answer here?  Or does it depend on the state code and -- gasp! -- the bank lawyers' interpretation of those applicable laws? In this case, I would apply the "Golden Rule" of estate planning--The One With The Gold Makes The Rules. Find a bank that allows you to do what you need to do, and move her money there. In the end, that will be a lot easier than trying to convince a recalcitrant bank's legal department (which most likely will only communicate with you via the branch manager, so it's already bad telephone) that you are allowed to do what you are trying to do. Really. Sometimes being right doesn't matter--if one bank will allow you to set up a payable on death account, and that's what you want to do, you've already solved the problem.