It is common for individuals to open a joint bank account simply for the convenience of having multiple signatories in respect of the bank account and not necessarily for the reason of giving all the account older(s) a beneficial interest, equal or otherwise, in the funds held in the bank account. Although this approach may appear to be a convenient and practical arrangement, upon closer scrutiny, having a joint account may present several problems when it comes to succession and wealth planning if one of the account holders dies.
A bank account held jointly with an “and/or” clause generally means that the account can be operated by any signatory and that the beneficial ownership of the funds will vest in the last surviving account holder and will form part of the last survivor’s estate. Any account holder(s) who died before the last surviving account holder would not be able to give the benefit of the funds in the account to their beneficiaries/next of kin as the funds would automatically vest in the last surviving account holder.
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