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Pros and Cons of Pay-on-Death AccountsPros and Cons of Pay-on-Death Accounts

Beware of unintended results.

Natalie M. Perry, Partner

April 16, 2024

12 Min Read
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Pay-on-death (POD) or  transfer-on-death (TOD) accounts are tools used in the estate-planning process to provide for streamlined administration and avoid probate proceedings on the account owner’s death (POD and TOD are referred to collectively for simplicity as POD accounts).1 POD statutes allow the account owner to implement a POD registration but don’t require it. 

Though POD accounts aren’t difficult to implement, when clients use these accounts, advisors should carefully consider the overall planning, including the estate plan, to address all goals and avoid unintended consequences. While POD accounts can provide for a smooth transition to a named beneficiary on the account owner’s death, they can often result in a disproportionate o...

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About the Author

Natalie M. Perry

Partner, Harrison LLP

Natalie M. Perry is a partner at Harrison LLP in Chicago.