Payable on Death (POD) accounts, also known as Transfer on Death (TOD) accounts, are financial accounts—such as savings accounts, checking accounts, or brokerage accounts—that have a designated beneficiary. Here's how they work:

Designation of Beneficiary: When you open a POD account, you have the option to designate one or more beneficiaries who will receive the funds in the account upon your death. You can typically do this by completing a beneficiary designation form provided by the financial institution holding the account. Many institutions limit beneficiaries to persons named and do not allow “contingent” beneficiaries should a listed beneficiary not survive the account owner.

Ownership During Your Lifetime: While you are alive, you retain full ownership and control of the POD account. You can deposit, withdraw, or manage the funds in the account as you see fit, without involvement from the designated beneficiaries.

Distribution Upon Death: Upon your death, the funds in the POD account are transferred directly to the designated beneficiary or beneficiaries, outside of the probate process. This means that the funds bypass your will and are distributed according to the beneficiary designation you established when opening the account.

Simplicity and Efficiency: POD accounts offer a relatively straightforward and efficient way to transfer assets to beneficiaries upon death. They can help avoid the time-consuming and potentially costly probate process, which is required for assets that pass through a will.

Flexibility: You have the flexibility to change or update the beneficiary designation on a POD account at any time during your lifetime, as long as you are of sound mind and capable of making decisions. This allows you to adjust your estate plan as needed to reflect changes in your circumstances or relationships.

It's important to note that while POD accounts can be a useful estate planning tool for certain assets, they may not be suitable for all situations. It's advisable to consider your overall estate plan and consult with us to determine the best approach for distributing your assets and achieving your estate planning goals.