Control When and How a Beneficiary
Receives Their Inheritance
Protect Their Inheritance
Fulfill Your Legacy
Disadvactages of Naming a person as the
Befeficiary on Payable Upon Death Accounts
Upon your death, the person or persons you named on a payable upon death (POD) account will receive the money in the account without going through probate. But what happens if one or more the beneficiaries predecease you?
The financial institution, not you, will determine who receives the share of the predeceased beneficiary. The predeceased beneficiary’s share may pass to:
- The predeceased beneficiary’s estate, meaning the share will go through probate. In probate, the spouse of the predeceased beneficiary may receive your money.
- The contingent beneficiary, if you named a contingent beneficiary.
- To the Issue (the natural or adopted children) of the predeceased beneficiary.
- The issue (the natural or adopted children) of the predeceased beneficiary.
If the amount in the payable upon death account is more than $5,000.00 and the beneficiary is a minor (a person under the age of eighteen) the money passing to a minor must go through probate and a conservator will be appointed for the minor until the minor attains the age of eighteen. When the minor attains the age of eighteen, they will receive the money in a lump sum.
Do you want an eighteen year old beneficiary to receive their inheritance in a lump sum?
Your trust can control when and how a beneficiary will receive their inheritance, protect their inheritance and fulfill your legacy.
Your Revocable Living Trust is the Best Way To:
Avoid the Uncertaninty of Payable on Death Accounts
Control When and How a Beneficiary
Receives Their Inheriatance
Protect Their Inheriatance
FulFill Your Legacy
Avoid Probate
You can name your Revocable Living Trust (and not a person) as the beneficiary of the account, and upon your death, the money in the account is paid into your Revocable Living Trust and does not go through probate.
The beneficiaries you name in the trust will receive their share according to the terms and conditions you established in the trust. For example, you may direct that the beneficiaries will receive their share of the trust as follows: One third at the age of twenty-five; one third at the age of thirty; and the balance at the age of thirty-five. Before the distributions to a beneficiary, you can give the Successor Trustee of your trust the discretion to use the beneficiary’s share of the trust for the beneficiary’s maintenance, support and education.
If one or more beneficiaries predeceases you, if you have named contingent beneficiaries, the contingent beneficiaries will receive the money without going through probate.
A properly drafted and funded Revocable Living Trust can:
- Direct who will receive your property for both primary and contingent beneficiaries
- Give you control regarding when and how a beneficiary will receive your property
- Protect their inheritance
- Avoid probate
- Fulfill your legacy
The information presented is not legal advice nor a foundation for an attorney/client relationship.