Banks have laid down strict norms for operating savings and salary accounts, which is good for the account holders also as this ensures that their hard-earned money remains safe. However, in times of any emergency or crisis, accessing a bank account becomes difficult even for the concerned account holder’s family members. So, can anything be done to make sure that a bank account is accessible by someone other than the account holder during a crisis?
Financial experts say that savings accounts are not aimed at any contingency or crisis; their purpose is to develop a habit of savings among people and protecting their hard-earned money from theft, physical damage, etc. So, one shouldn’t consider saving accounts as rescuers from a crisis.
However, to avoid a situation like this, some preventive steps can be taken by the account holders, like opening a joint account.
“The precaution that account holders should take is to open savings accounts in joint names so that more than one person can access the account at any given point of time. Banks offer several options on how these accounts can be operated, viz., ‘First Holder or Survivor’ and ‘Either or Survivor.’ The former type doesn’t allow both the holders to operate the account; only the first holder can operate the account, and for couples, it is ideal to monitor their finances. In the latter option, however, both partners are allowed to operate the account,” says Rachit Chawla, Founder & CEO, Finway Capital.
If the deposit is to be paid before maturity in ‘First Holder or Survivor,’ then signatures of both the depositors are mandatory, but after the demise of the first holder, all rights automatically shift to the second holder. However, the second holder will have to produce the necessary documents to prove the demise of the first holder. Usually, ‘Either or Survivor’ is technically more simple and easy if the chemistry between the people is good and long-lasting. This will also ensure that any of the account holders can operate the account if one
is not well or there is a crisis.
There is also a nomination facility, which is always available to savings account holders, – i.e., the account holder can designate a nominee who will be the beneficiary in case of the demise of the account holder. Moreover, if the account holder couldn’t decide the name of the nominee, he/she is free to choose one at any point in time during his/her life.
“If someone thinks that he/she has chosen the wrong person, he/she can willfully change the nominee in his/her life. It is simple as well as the authentic procedure that is instrumentally helpful in settling false claims and protecting the rights of the nominee appointed by the deceased. However, one shouldn’t forget that a nominee can exercise his/her rights only after the death of the account holder and not during illness or other emergencies,” says Chawla.
If the matter relates to only making some payments or urgent fund transfer in times of crisis, then that can be done online also. All you have to do is to leave your account number and the online banking passwords with someone in your family you trust. This will solve all the problems!