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The Math Trap- How Joint Accounts Can Ruin Your Life

Updated: Jan 6, 2023

Are you a financial caretaker of a vulnerable adult?

The Math Trap, how Joint Accounts can ruin your life.

You need to be aware of The Joint Account Math Trap and how to avoid it.

Remember, No good deed goes unpunished.

If you aren’t careful, you could get into trouble for spending your own money.

I know, it sounds insane, but it can have life-changing consequences including the possibility of lengthy criminal investigations and the risk of jail time.

How can this be the case? It’s all because of Oregon Statute ORS 708A.465 which governs Ownership of multiple-party accounts, like joint accounts, and reads as follows:

“A joint account belongs, during the lifetime of all parties, to the parties in proportion to the net contributions by each to the sums on deposit, unless there is clear and convincing evidence of a different intent.”

What does that mean for you?

It means that the ownership of each and every dollar in a joint account is assumed to be shared so you cannot spend a dollar without spending the other person's money too.

Imagine for a moment that you and I are at an amusement park requiring tickets. Each of us has five paper tickets. I decide to ride the water-log ride for one ticket and I ask you to hold my four remaining tickets so they don’t get wet. You are now holding 9 tickets( My 4 and your 5). Still with me?

I am waiting in line for the water log ride, so you decide to ride the Ferris wheel, which costs 2 tickets. You give the ticket taker 2 of the 9 tickets in your hand.

As you enjoy the view from the top of the Ferris wheel, you see that I am still waiting in line and you wave to me. When you catch my eye, you’re surprised because I look angry with you.

When we meet up again, I am outraged, and scream “How dare you spend my ticket for your Faris Wheel Ride! ”

Shocked, you respond I didn’t spend your ticket, I spent two of my own tickets!” I have all four of yours right here! (holds out 7 tickets my remaining 3 and your 4).

Indignant, I respond “No! You spent one ticket of yours and one of mine!” You scratch your

head, do the math, and show me that you have my 4 tickets but I'm still mad. I wouldn’t blame you if you thought I was being unreasonable, or at least counter-intuitive in my allegations; however, the position I hold here is the same one the State of Oregon holds.

The State of Oregon looks at a joint account like it’s a mixed drink:

“One of you may have brought the Orange Juice and the other may have supplied the Vodka, but every drop that spills out is a Screwdriver.”

Having a joint account with a loved one can be confusing. Don’t get punished for doing the right thing. If you are a joint account holder with a vulnerable adult, consult with an attorney to make sure you are protected.

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