Bank of MMKate: Joint Accounts?

Whenever my immediate family has a cashflow problem, I get a call. I’ve only been screwed over once (by my brother, whose off-hand attitude towards this sort of obligation sends my blood pressure soaring up to…well, the normal range – my BP is ridiculously low). A sampling of what I’ve funded and been repaid for:

  • My sister’s moving costs after leaving an emotionally abusive BF – $1200
  • My parents’ bankruptcy fees – $1000
  • Prevention of a sheriff’s lien on grandparents’ home, @ age 15 – $4200
  • Emergency flight to Colorado after a Bad Thing – $450
  • My sister’s car, needed for school – $7000 (in progress)
  • Leisure travel for Mom – $1700 (in progress)
  • My dad’s knee replacement surgery (apparently they want a 15% deposit from bankrupt patients even when mom obtains a letter confirming 100% coverage) – $3000

So my dilemma is… what if I’m in need? What if I end up in a coma, or need bail money, or something bizarre like that? I’ve got the money but won’t be in a position to get to it, and none of them have the funds to cover me until I can. So I’ve been thinking about making my checking account joint with my mother, and having her put me on hers…but her credit score sucks (2 more years before the bankruptcy drops off her credit report), and I don’t know if having joint accounts with her will drag mine down. Plus, I don’t know if there are tax implications. At the moment, we each have a blank check on each other’s account – but no way of knowing how much we can write that check for in the event of bail/death/ransom/etc. Having cards, checks, access codes, etc. would make that a whole lot simpler.

Anyone have any experience of this?

And stop laughing at “ransom” – when I went on vacation to the Middle East last year, I got travel insurance with Act of Terrorism coverage, which provided up to $100K for rescue and ransom. Hey, it was only an additional 29 cents, which is very comforting (cheap = no claims ever made/paid).

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9 Responses

  1. all i know is – you are GOOD to your family 🙂 I am very very impressed. i go ballistic when i have to loan someone $100 bucks and i don’t get it back. you are an angel!

    but yes, you def. have to cover your own in case something comes up (which i really hope doesn’t!). not sure how to go about doing that exactly, but you’re a smartie.

  2. I’m more of a responsible sucker than an angel, but what choice did I really have? Anyway, that’s the first time anyone has called me “a smartie” in a nice way 😀

  3. One, why are you lending money to family?
    do you ever really get it back? and haven’t you read the many of financial books that say lending to family is a “no, no” because you will be taken advantage of or it will cause unnecessary havoc in your family? they will continue to ask from the hand that feeds them.

    Two, why are you opening a joint checking account with your mother? From a reader’s perspective based on this blog note, I would say, “what are you thinking?” you sound like you are doing great. Why do you want to complicate it with more complications, tax implications and dredging your credit score????

    If something happens to you…. then you have a LIVING TRUST cover you. That should cost you anywhere between $500 – $1500 for someone to draw it up. And will take care of this dilemma about your health and money if your are hurt. Read Suze Orman’s Smart Money for Woman book. It explains it all.

    Also, complete an advance healthcare directive. This will take care of who is in charge of your healthcare if you become incoherent.

    I don’t think it would be wise to put someone on your checking account (regardless of how much you love them) when it seems they are continuously borrowing from you.

  4. I’m usually the only option. That emergency flight was in the aftermath of my sister being the victim of a violent crime. My grandparents’ home…well, we were all living in it and would have lost the roof over our heads in 30 days. I couldn’t let my sister ask her ex for the money to get away from him, or tell my almost-immobile father that he couldn’t have new knees. I really did get all the money back (some with interest!).

    My mother is actually very smart when it comes to money, but my father was awful with it, couldn’t stop spending their way into bankruptcy no matter how many times she got the card numbers changed to thwart him. But he died nearly 4 years ago, and now my mother has a 403b, an emergency fund of her own, a “cushion” built into her checking account, and a hatred of credit cards. The only reason she has an outstanding debt with me for airplane tickets is that I don’t want the money back. They were all supposed to be gifts, but she refuses to accept something that expensive (it’s 3/4 paid off now).

    But…maybe it would just be a good-enough idea to swap account access info so we can check balances before using the blank emergency checks. We both have locked fireproof boxes and a cute way of encoding things for added security.

  5. Hi there-my mum recently broke her ankle, so is housebound for the forseeable future. This is the only occasion she gave me access to her account to get money for groceries, etc. I think one offs like this in an emergency can work well, if the trust is there.

  6. It’s the same with my family and I… I’m the one who gets the call if someone’s in financial trouble. 😦 One relative in particular… I’ve given her over $10,000 (scattered over the past 4 years), and I’ve let her stay with my bf and I for the last year (at least I haven’t had to give her any money during that time). I’m 99% sure I’ll never see that money again. It’s depressing, but what can I do? I love her and I want to see her get back on her feet.

    It’s very admirable that you’ve helped so many different family members! And refreshing to see that they paid you back. 🙂

    Anyway… having a joint checking account with your mom shouldn’t effect your credit score at all. Having a joint credit card (which she charges up to the max or something) will. I have a joint account with my bf, and I’ve never run into any tax issues.

  7. I admire the fact that you want to help your family and if you read portions of my blog lately, you’ll notice that I’ve been doing the same but in my case, it has sent me into a financial nightmare!
    Dont you ever feel resentful that they lean on you so much? When it was just me, I hated it but now that I have my son and I’m the sole supporter, I have to look after our interests. Unfortunately they dont get it at all. It’s their needs over ours.
    Just wondering what your thoughts were on this?

    • Maria, you didn’t leave a link to your blog…

      I used to have such mixed feelings of resentment that they couldn’t take care of their own business and pride that I could – and did so well at it that I could help them. Now it’s just pride because they felt such shame at needing to borrow repeatedly from their daughter / sister, that they all got their financial act together. That I could lend them money and buy emergency plane tickets while unemployed without going into debt was a huge wake-up call for them.

      • Thanks for replying to my comment. I think I’ve left my link but if not it’s centsandsensibility.wordpress.com.

        It’s nice to hear that your family realized that they needed to be on their own two feet. It gives me hope for my family.

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