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Transferring Wealth Made Easy: The Transfer on Death Registration

Posted by WrapManager's Investment Policy Committee
April 8, 2014

The transfer on death (TOD) account registration is a good way to establish beneficiaries on your non-retirement accounts. It ensures your assets are transferred to your chosen beneficiaries seamlessly, so your family may avoid the potentially costly, emotionally difficult, and drawn-out probate process.

Why Set Up a TOD Registered Account?

The TOD designation usually allows your family to bypass probate when distributing assets at your death. For instance, let’s say you have an individual brokerage account where you hold stocks and other securities, but you don’t have a TOD registration. When you pass away, those assets will likely move into probate, and legal parties will have to look to your last will and testament as a guide for how to distribute them. If the language in the will isn’t clear or there are questions, it could make an emotionally difficult time even more difficult for your heirs.

The TOD registration bypasses all of that. It takes precedence over anything stated in the will, so the assets will be distributed as you want and there won’t be any questions asked.

The TOD Designation for Joint Accounts

Many married couples with taxable accounts typically set them up as “Joint Tenants with Rights of Survivorship (JTWROS)” or “Tenants in Common” accounts, so that if one spouse passes the other will maintain control of the assets. In those cases, the TOD registration may not seem necessary, but it can be helpful.

For example, if both people on the account pass away simultaneously, the TOD will name an additional beneficiary to receive the assets. It’s a good backup plan to have in place.1

TOD Designation for Your Bank Accounts

You can also set up this type of designation on your checking and savings accounts at your bank. For these types of accounts, it’s known as a “Payment on Death” designation.

How to Set Up a TOD Registration for Non-Retirement Accounts

It’s simple – just ask your financial advisor, or banker, for the forms needed to set your beneficiaries. Once complete, you can have beneficiaries set up as you wish across all of your investment accounts, not just your IRAs. It makes planning easy and keeps you in control.2

WrapManager Can Help You Set Up Beneficiaries Across Your Investment Accounts

You’ve worked hard for these assets, and we realize it’s important to make sure they are cared for even after you pass away. Setting up beneficiaries correctly – and reviewing and updating them regularly – is one of the many services our Wealth Managers can provide.

Call one of our Wealth Managers today at 1-800-541-7774 to have them review your investment accounts and provide you guidance.


1 Fidelity

2 Nolo

Investment Planning