What if you disagree with a payable-on-death account?

On Behalf of | May 28, 2024 | Probate Litigation

Payable-on-death accounts (PODs) are a popular estate planning tool due to the efficiency with which they can transfer an asset to someone else. By simply designating someone as the beneficiary of a POD, you enable the money in that account to pass to them when you die without having to pass through probate, which might otherwise be costly and cause major delays.

PODs work well, provided that an account holder approaches them appropriately and remembers to update them when they no longer represent their wishes. Yet, many people forget to update their PODs. They might, for example, put their spouse as the beneficiary but forget to remove them when they divorce. Or they might make their child the beneficiary, but forget to add the siblings that come along later.

What if PODs contradict the terms of a will?

People sometimes forget they have already designated someone to receive particular assets via a POD account. They then write something that clashes with this designation in their will, such as “I wish to leave everything I own to my new spouse.” When the person dies, the new spouse might be upset to discover they do not actually get “everything” because some of it is going to the person named on the POD. A POD designation generally supersedes anything written elsewhere.

The difficulty of challenging a POD designation is one reason that many people choose to use one. They are not designed to be challenged. Yet, if you believe you have a valid concern, it’s important to get legal help to examine your options.

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