10 Sep Was the wrong person given this bank account after owner’s death?
Q. Say an account is jointly owned by a husband and wife and is payable upon death to the other spouse. Say the husband dies. The bank says the daughter is the successor trustee and the account goes to her. But the account was going to the daughter if both spouses died because the daughter was the backup. What happens?
A. Something’s not right in this scenario.
A payable on death (POD) account is sometimes called a transfer on death (TOD) account or a Totten Trust.
If a joint account has a POD designation, then the POD would only take effect after the second owner of the account passes away, assuming this is a joint account with rights of survivorship, said Ken Van Leeuwen, a certified financial planner with Van Leeuwen & Company in Princeton.
“In this case, the wife would be the sole owner of the account with the POD designation still being the daughter,” Van Leeuwen said. “It is typically it is uncommon to add a POD designation to a joint account that does not have rights of survivorship.”
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This story was originally published on Sept. 10, 2020.
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