Know the Ins and Outs of Joint Tenancy
Joint tenancy refers to a type of account that is owned by at least two people who have an equal right to the account's assets. In fact, they have survivorship rights in the event of the death of the other accountholder. So, if you are married and your spouse dies, you receive all the money or property you both own. What are the advantages and disadvantages?
These outcomes can make some spouses or business partners turn to tenancy in common. This way, fractional ownership can be established. For example, each owner holds half an asset, and each party can legally sell his or her share without the other's approval or consent. People favor tenancy in common because the asset doesn't automatically transfer to the surviving owner's account. Instead, the deceased can make provisions in his or her will to pass the asset to heirs or to the other account owner.
Obviously, it behooves you to look at the attractive features of joint tenancy before taking title to an asset; assess your situation and determine which option is more favorable to you. Talk to a financial professional before making a major ownership decision.
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