How To Add Payable On Death To Bank Account?

Payable-on-death or POD is a straightforward way of passing money to a particular person or people away from the bank by naming them as beneficiaries. Below is a guideline on how to open a bank account and include a POD beneficiary:

What is this Payable On Death Account?

A POD account is a regular bank account that would have a Totten trust Accounting Services added to it that mentions a POD beneficiary. It enables you to identify one or more individuals who shall take the money after you die without the process of administration of the estate.

Should you not die, the account balance belongs solely to you and you have the sole discretion to decide on its disposition. This is true because you are free to withdraw the money, close the account, and to revoke or change the POD beneficiary at any time you desire. A POD beneficiary can only claim any funds in the account once the original account holder is deceased.

The remaining funds will be directly distributed to the eventually nominated beneficiary in what is called a POD account. It helps to avoid having the money tied up in the probate process whereby the legal proceedings delay the distribution of the funds to the beneficiary.

Advantages associated with the use of POD Bank Accounts

Several key benefits come with adding a POD designation to your bank account:

- Do not go through probate – The funds go directly to the surviving party at the time of the death and do not go through the legal process for months or even years.
- Save Legal Expenses – Will makers and probate lawyers are not involved thus no lawyer fees are charged
- Full control – The original owner remains fully in charge of the account all through up to the time when they surrender control.
- Installation – This app can be integrated with new or other active accounts easily.
- Flexibility – Flexibility is another advantage of using this model because beneficiaries can be changed anytime depending on the prevailing circumstances.

This article explains how to add a POD beneficiary to your bank account.

Here is the process of making one’s bank account or at the time of account opening having POD payable-on-death beneficiary.

1. Contact your bank

The first action a beneficiary can take is to consult the bank and find out more about the rules and regulations of the bank concerning the POD addition. Some key questions to ask:

- What are the different types of forms and identification documents needed when adding a POD?
- Can I designate more than one POD beneficiary?
- Is it possible to switch the POD beneficiaries at a later date or can the POD designation be completely nullified?

2. Complete the form on POD designation

Any standard POD form should be acceptable in most banks, or at least it should be used as a model by which banks create their forms to fill out as beneficiaries. On it, you will input your account number, the name of the primary as well as other secondary beneficiary, and their contact information.

Some key tips for filling it out:

- When quantifying the benefits, clearly determine specific percentages for each beneficiary
- Enumerate both direct and indirect benefactors
- Ensure that any method of contact with them includes both their full legal names.

3. Gather beneficiary documentation

A common requirement that comes with these letters is the presentation of identification documents such as photo identification or social security numbers of all beneficiaries as named in the letter. Find out which verification documents your bank accepts in your country and the type of verification documents that are accepted by the particular bank you are dealing with.

4. Submit the form to bank

After the completion of all requirements in the form, send the POD form to your bank alongside all the required documents as the bank deems appropriate such as through mail, uploading the document online, etc. Quite frequently, you will receive a compliance letter in response to your request to include your POD designation.

5. Inform your beneficiaries

It is prudent to make the named beneficiaries aware of the change you make on the bank account to name them as payable on death beneficiaries. This saves you from having shocks or misunderstandings later after you are gone, depending on the contract’s terms.

But remember that at the present you are not sharing with them even some access or control of the funds. Also, make them aware of the particular bank name together with the account number alongside an approximate figure that they were to receive on your demise.

Managing Your POD Account

Once established, here are some tips for managing your POD account going forward:

- Beneficiaries should be reviewed as often as necessary and should be changed if the circumstances require it.
- Ensure that all the contact information provided is up-to-date if your beneficiaries are to benefit.
- Inform the bank in case of account closure, or wish to revoke the POD.
- Appreciate tax consequences that could arise in the hands of the recipient of any inherited amounts exceeding the exemption limits

One of the wise legal services to consider is having payable-on-death instructions on the bank accounts since it helps to pass funds directly to the desired beneficiaries without going through the probate process after one is gone. The following are some general procedures to follow while adding POD beneficiaries to new or existing bank accounts.