Advantages And Disadvantages Of Using TOD Accounts To Avoid Probate

An increasingly popular way to avoid probate and other estate planning issues is the transfer on death or payable on death account. There can be more to these accounts, which I’ll refer to as TODs, than many people realize.

Most financial institutions now have a specific form that is completed to designate an account as a TOD and name the beneficiary (or beneficiaries). Most states have laws recognizing the accounts and setting rules for them.