Trust vs. POD & TOD

My accounts use POD and TOD. Doesn’t this do the same thing as a Trust?

POD “Payable on Death” and TOD “Transfer on Death” accounts avoid probate only if the heir is alive, not disabled, and not a minor. But these labels will not protect the account from disgruntled heirs and unscrupulous strangers and do not protect you in the event of incapacity. Moreover, every time your estate plan changes, you must change each and every TOD & POD account.  All of this is avoided with a trust with CompleteMyEstatePlan.com. By making the trust the beneficiary on your assets, only the trust needs to be changed in order to redistribute your assets; and the quality trusts from CompleteMyEstatePlan will ensure every protection is available to keep the inheritance safe.

My assets are in joint-tenancy, doesn’t this avoid probate?

Not really. Joint tenancy only postpones probate.  When one owner dies the asset will pass to the remaining joint tenants without probate. But if the remaining owners die without naming a new owner, the asset must be probated.  If an owner becomes incapacitated, the court takes control. There are also gift and capital gains tax liabilities. Putting someone else's name on your assets exposes them to the person's creditors - risking your assets being taken by a judgment against the other owner.

And remember, when you die, the joint assets pass to the survivor and then to the survivor’s heirs, effectively disinheriting your family. Moreover, your liability exposure increases with joint tenancy. Any creditors (divorce, IRS, personal injury, bankruptcy) of any joint tenant can reach the entire asset; not just the joint tenant’s portion.

Much like most online documents, POD and TOD offer no creditor protection for the inheritance. Lawsuits, nursing homes, divorce and other creditors commonly take inheritances away from unsuspecting heirs. CompleteMyEstatePlan.com constantly updates their documents to make sure you have the highest quality and most up-to-date asset protection provisions in your trust; ensuring your gift to your heirs is safe and secure for years to come.

Should we wait until one spouse dies to set up a trust?

It is a gamble, because if both spouses die at the same time then the estate will go through probate. But if you are certain that only one spouse will die (alone) and/or the survivor will not be incapacitated, then you can wait. However, this means you will have paid for two wills (while both spouses are alive) and for one trust (when one spouse dies) instead of paying for one married trust. Simply put, waiting costs more. A trust is the better option versus POD or TOD. Get started with CompleteMyEstatePlan.com today!