A recent article published by MarketWatch, https://www.marketwatch.com/story/how-to-give-your-heirs-quick-access-to-your-bank-accounts-when-you-die-11633038931?mod=home-page, answered the question of how to give your heirs quick access to your accounts when you die. This article will summarize the information in that article and give insights into various other estate planning tips for California estate plans.
- Transfer on Death (TOD), Payable on Death (POD)
When opening a bank account or amending an existing account, you fill out a form either online or in person to make someone the payable on death beneficiary of the account.
- What if you have more than one person you want to designate?
Typically, you can designate as many people as you desire and you will allocate a percentage of the account that will go to each person.
- What is the advantage of the TOD/POD?
While there is still some process involved (the beneficiary has to show the bank a certificate of death and the beneficiary’s identification), the advantage is that probate is avoided for this particular account. This saves time, money and inconvenience.
- What about making your heir the joint owner on your account?
Another strategy is to designate your heir as the joint owner on your account. This has some advantages and disadvantages. On the upside, the heir can withdraw the money upon your death right away. The downside is that the heir can also withdraw the money anytime during your lifetime. It also subjects those funds to creditors of your heir during your lifetime. Because of these risks, a joint ownership plan is not the best for some families. For relationships with a very high level of trust, it might make sense.
How to Help Your Loved Ones
There are many choices with estate planning in California, but the first step in helping your loved ones is to become informed of your options and get a plan in place. You’ll want to make sure any paperwork related to estate planning easily accessible to your loved ones and that it is up to date with any changes needed. At the Law Office of David Knecht we have extensive experience with estate planning in California and can help you get started or update your existing plan. Contact us at 707-451-4502 for more information.
