PODs and TODs
Another type of financial
asset
with a designated
beneficiary,
who will receive the assets outside of probate, is a bank account or security titled specifically for that purpose. In the case of bank accounts, this method of titling ownership is known as payable-on-death, or POD. Securities or investment accounts titled this way are known as transferable-on-death, or TOD.
How it works
During the process of opening a bank account, you’ll have to answer a question about how you’d like to title the account: as a sole ownership, a joint tenancy with right of survivorship, a tenancy in common, or a POD account. If you choose a POD account, you name beneficiaries, who get ownership of the account after your death.
You can also set up a TOD registration for securities and brokerage accounts, generally by filling out a form, which you can request from your broker.
Titling ownership of bank accounts and securities in this fashion isn’t available in all states, however, and state laws may vary.
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