We all know the saying, “It’s the little things that count.” This is especially true when it comes to your estate plan. Making sure your accounts and assets outside of a Trust have Transfer on Death (TOD), or Payable on Death (POD), designations is one of those “little things” that can have a big impact. When someone dies, the probate process can be slow and costly! If your bank accounts, investment accounts, and deeds on real estate have specific TOD or POD designations, you can save your beneficiaries a lot of time and money.
A direct transfer of assets with TOD or POD beneficiaries happens automatically upon the passing of the account owner. Otherwise, the assets will follow the language of the Last Will and are subject to the probate court process.
The terms vary, but the goal is the same. Payable on Death is used most often with bank checking or savings accounts. Transfer on Death is most common with taxable investment accounts, or direct ownership of stock shares. Beneficiaries is the label used with retirement accounts, such as a 401k or IRA. We are happy to review this with you if you are uncertain that your accounts are set up correctly.
If you have additional questions on how this could affect your estate plan, please ask. Our goal is to give you peace of mind, knowing that your estate plan will run as smoothly as it can for your loved ones.