Payable-On-Death Account, P.O.D., How It Works And Why It’s Necessary

Payable on Death (POD) is an arrangement between a bank and a client that designates beneficiaries to receive the client’s entire assets after the death of the client.

Lovetvnews Nigeria reports that Payable-on-death bank accounts offer an easy way to keep money, even large sums of it out of probate. some experts believe that by adopting the POD measure, the issue of unclaimed deposits in banks will be reduced to the barest minimum.

What To Do:
All you need to do is properly notify your bank of whom you want to inherit the money in the account or fixed deposit. The bank and the beneficiary you name will do the rest, bypassing probate court entirely. It is that simple, according to www.nolo.com.

This kind of account has been called the “poor man’s trust.” And it is true that a (free) payable-on-death account designation avoids probate just as well as an expensive, lawyer-drawn living trust would.

This Online news medium understands that as long as you are alive, the person you named to inherit the money in a POD account has no rights to it. If you need the money, or just change your mind about leaving it to the beneficiary you named, you can spend the money, name a different beneficiary, or close the account.

Advantages:
They are easy to create; there is no limit on how much money you can leave this way; designating a beneficiary for a bank account costs nothing, and it is easy for the beneficiary to claim the money after the original owner dies.

The POD payee you name has no rights to the money as long as you are alive. After your death, all a POD beneficiary needs to do to claim the money is show the bank a certified copy of the death certificate and proof of his or her identity. If the account was a joint account to begin with, the bank will need to see the death certificates of all the original owners. The bank records will show that the beneficiary is entitled to whatever money is in the account. The bank does not need anything from the probate court. Depending on state law, there may be a short waiting period before the payee can collect the funds.
Source: Punch