Because You Asked: Is There a Problem with Single-Owner Bank Accounts?

An Unintended Problem with Single-Owner Bank Accounts:

We have had a few widows contact us lately, who found themselves dealing with some difficult financial challenges due to some unfortunate choices that their spouses made.  In particular, we learned that the deceased spouse was the only owner of individual checking accounts that held the majority of the couple’s cash assets.  And even though the widows had signing authority on the bank accounts, that authority did not carry over after the owner’s death, which created a cash shortage immediately following their deaths.  Additionally, if these accounts are “locked” due to the death of the owner, it could mean that automatically-drafted payments, such as a mortgage will not be processed.

One individual thought that because she had a Power of Attorney document for her husband that she would still be able to access the account.  What is not commonly known is that a Power of Attorney only applies as long as the individual is living; it terminates at death, whereupon an Executor of the estate then has responsibility.

These widows are now faced with having to complete the probate process, in order to change bank account ownership and obtain access to the funds in the checking accounts.  This could easily take several months or more, especially considering the current additional delays related to Covid -19.  If there was not a properly executed will for the deceased, expect the process to take a year or more. Here are the 8 steps I found to describe the probate process in Texas:

  1. Filing: application for probate filed in probate course where the decedent lived.
  2. Posting: after filing for probate, there is a two-week waiting period before you receive a hearing on the application. The clerk posts a notice of the probate application at the courthouse.
  3. Validating the will: after the waiting period, the probate judge presides over a hearing to recognize the decedent’s death, and to verify that there was a valid will and an appointed executor.
  4. Prepare an Inventory: After the executor or an administrator is named, that individual prepares an inventory of all of the assets held by the decedent and reports it to the county clerk.
  5. Identify beneficiaries of the estate: either by virtue of the will, or if there is not a will, the probate court will determine heirship.
  6. Notify creditors: creditors are given the opportunity to file claims against the estate.
  7. Resolve disputes: if beneficiaries are contesting the will, etc. the probate court judge will hold hearings to resolve the disputes.
  8. Assets are distributed only after debts and disputes are resolved.

How to Fix the Problem with Single-Owner Bank Accounts:

There are a couple of ways to address this particular issue with bank accounts and remove it as a potential barrier for your spouse:

  1. Convert the account(s) to joint ownership, rather than just giving signature authority.
  2. Designate all of your bank accounts as Pay on Death. By utilizing this banking tool, you are naming beneficiaries who will become the owner of your accounts upon your death with a simple death certificate. You can and should do this with checking, savings, CD’s, etc.

Both of these can be accomplished by visiting your bank and telling them what you want to do or possibly contacting them via telephone or on-line banking.  We urge bank account holders to take care of this as soon as possible, to remove this potential barrier for your spouses and loved ones.

While You Are at it: Don’t Forget to Look at Ownership of Utility Company Accounts

In addition to the primary concern noted above regarding banking another issue that has been brought to my attention recently had to do with accounts with utility companies.  Apparently, if the utilities are in one person’s name, the utility company will not allow the other household members to do anything to the account: questioning or updating a bill, changing payment options, etc.  So the way to address this is to have the current account owner contact the utility company and request an affidavit to add an additional account holder or spouse.

Dealing with utility companies may be minor in comparison to accessing a checking/savings account, but if there is a way to prevent additional headaches, it seems wise to do so. Not only would this be a factor following the account holder’s death, but it would also affect the homeowner in the event of a divorce.


It is likely needless to point out that taking pre-emptive and proactive actions that we are able to accomplish now, goes a long way to helping ease some of the trauma following the death of a loved one.  On an emotional level, we may be inclined to avoid those types of discussions or even thinking about our guaranteed exit, but perhaps we can instead think about these opportunities to take care of our loved ones after we are gone.


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