Retirement & Financial Planning Report

Many people, especially married couples, hold real estate, securities, and other assets as “joint tenants with right of survivorship” (JTWROS). With this arrangement, if one co-owner dies, the other co-owner automatically inherits the property.

Advantages: Property owned as JTWROS avoids the time and expense of probate. This is a simple, inexpensive way to keep property from the probate process. Moreover, one co-owner can handle the asset if the other is incapacitated.

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Drawback: Using JTWROS limits your flexibility. If you hold all of your assets with your spouse, they’ll all be inherited by your spouse. Nothing can pass to your other heirs, such as your children, no matter what you say in your will.

Depending on the size of the estate, at the surviving spouse’s death significant taxes may be due that could have been avoided if the first spouse to die had left some assets to their children.