Reviewing Your POD Account Beneficiaries

What is a POD Account and Why Review Beneficiaries?

A payable-on-death (POD) account is a type of bank account that allows you to name beneficiaries who will automatically inherit the account's funds when you pass away. The money in the account bypasses probate and transfers directly to your designated beneficiaries.

Regularly reviewing and updating your POD account beneficiaries is essential for ensuring your assets go where you intend after your death. Life circumstances can change through marriages, divorces, births, or deaths in the family. Failing to adjust beneficiary designations means your money could end up going to someone you didn't want to receive it.

Accounts That Allow POD Beneficiary Designations

Several types of accounts can have POD (or "Transfer on Death" TOD) beneficiary designations, including:

• Bank savings and checking accounts
• Certificates of deposit (CDs)
• Brokerage accounts for stocks, bonds, and mutual funds
• Certain retirement accounts like IRAs

It's a good idea to name POD beneficiaries on any account where it's allowed. This simple step helps assets transfer smoothly while avoiding the time and expense of probate.

When to Review and Update Your Beneficiaries

You should review your POD beneficiary designations whenever there is a major life event or change in your circumstances, such as:

• Marriage or divorce
• Birth or adoption of a child
• Death of a spouse, child, or named beneficiary
• Changing your intentions about who should inherit assets

At a minimum, review your beneficiaries annually and adjust as needed to reflect your current wishes. Many banks and financial institutions provide annual reminders to review designations.

How to Check Your Current POD Beneficiaries

To see who is currently listed as the POD beneficiary on each of your accounts:

1. Log into your online banking portals or brokerage accounts
2. Look for a "Beneficiaries" or "Transfer on Death" section
3. Your named beneficiary(ies) will be listed with their contact information
4. Review to make sure the listings are accurate and still aligned with your wishes

If you can't find the beneficiary information online, contact your bank or investment company directly. Request a copy of your current POD beneficiary designations for review.

Changing or Updating POD Account Beneficiaries

If you need to change or update the beneficiaries on your POD accounts, the process is usually straightforward:

1. Contact your bank, brokerage firm, or account administrator
2. Request a "Beneficiary Designation Form" for that account
3. Fill out the form with the new beneficiary's full name and contact details
4. Submit the completed form based on the institution's requirements

Some institutions allow you to complete this process online or over the phone. Others will require a signed paper form be mailed or submitted in person.

Be sure to get written confirmation once your beneficiary updates are complete. Review it carefully to ensure the changes were made properly.

Tips for Naming Beneficiaries

When updating beneficiaries, keep these tips in mind:

• Be as specific as possible with names, relationship, birthdates, and contact details
• Consider naming secondary/contingent beneficiaries in case your primary passes away
• For non-spouse beneficiaries, get advice on potential tax implications
• With multiple beneficiaries, specify how to split the assets (percentages)
• Update beneficiaries after major life events like marriage/divorce
• Review designations periodically and keep them current

Getting beneficiary details right is crucial to ensure your wishes are carried out and avoid potential legal battles later.

Common Beneficiary Mistakes to Avoid

Some common pitfalls to be aware of when naming POD account beneficiaries:

• Failing to name a beneficiary at all
• Listing outdated or incomplete information
• Naming minor children directly (use trusts instead)
• Forgetting to update after divorce or spouse's death
• Listing your estate as the beneficiary
• Not specifying final beneficiaries after primary/secondary

Taking a little time to review and update beneficiary designations can prevent these mistakes and ensure your assets transfer properly.

Wrapping Up - Your Next Steps

Regularly reviewing POD beneficiary designations is an important but often overlooked estate planning task. By taking the time to:

1. Gather a list of all your accounts allowing beneficiary designations
2. Review the current beneficiaries listed
3. Update with new beneficiary details if needed
4. Get written confirmations of any changes

You'll ensure your funds transfer smoothly and go precisely where you want after you're gone. Consider getting professional advice if you have a complex situation.

For more help creating a full estate plan, explore our Estate Planning Guide.