To avoid probate on bank accounts, you can use one of three tools: a payable on death (POD) designation, joint ownership with rights of survivorship, or a revocable living trust. Each moves your funds directly to the people you choose the moment you die, without a court appointing a personal representative first. Without one of them in place, a bank generally cannot release your money until probate opens, which can take months and cost thousands in legal fees.
Payable on Death Designations
A POD designation, sometimes called a transfer on death (TOD) or Totten trust, is the simplest option. You complete a form at your bank naming one or more beneficiaries. When you die, they collect the funds by showing the bank a certified death certificate. No executor, no court order, no waiting for probate to close.
You keep full control while you’re alive. The people you name cannot check the balance, make withdrawals, or influence how you spend the money. You can change or remove beneficiaries at any time without telling them, and the designation overrides whatever your will says about that account.
One catch worth planning around: a POD only works if at least one named beneficiary is alive when you die. If your sole beneficiary dies first and you never update the form, the account falls into your probate estate. Banks do not automatically redirect funds to a deceased beneficiary’s heirs. Name more than one beneficiary, or list contingent beneficiaries if your bank’s form allows, and revisit the designations after any marriage, divorce, birth, or death in the family. Updating is free, and most banks let you do it online or at a branch.
A POD beneficiary has no authority to manage the account if you become incapacitated. That job belongs to someone named in a durable power of attorney or a court-appointed guardian. And an agent under a power of attorney generally cannot change your POD beneficiaries unless the document specifically grants that authority, and even then cannot name themselves.
Joint Ownership With Rights of Survivorship
Adding a co-owner with rights of survivorship is the second route around probate. When one owner dies, the survivor automatically owns the entire balance by operation of law. No court involvement.
Titling has to be exact. The account must be set up as “joint with rights of survivorship” (often abbreviated JTWROS). An account titled as “tenants in common” does not carry the survivorship feature: the deceased owner’s share becomes part of the probate estate and passes under the will or state intestacy law.1Consumer Financial Protection Bureau. What Happens if I Have a Joint Bank Account With Someone Who Died? Most banks default to rights of survivorship on joint accounts, but check the signature card or account agreement.
Risks Joint Ownership Carries That a POD Does Not
- Creditor exposure. Because both owners have equal rights to the funds, a creditor with a judgment against your co-owner may be able to garnish the entire account, even if you deposited every dollar. Some states limit garnishment to the debtor’s share; many do not.
- Gift tax. Adding a non-spouse co-owner who can withdraw funds may be treated as a taxable gift. Nothing is owed while the value stays within the annual exclusion ($19,000 per recipient in 2026), but larger balances can create a filing obligation.2Internal Revenue Service. Frequently Asked Questions on Gift Taxes
- Medicaid look-back. If you later need Medicaid-funded long-term care, adding a non-spouse joint owner may count as a transfer of assets during the five-year look-back, depending on how the account is titled. A violation can trigger a penalty period of ineligibility.
- Loss of control. A joint owner can withdraw money at any time while you are alive, without your permission.
For someone who simply wants a bank account to pass to a specific person at death, a POD is usually the safer choice.
Putting a Bank Account Into a Revocable Living Trust
A revocable living trust avoids probate for any asset held in the trust’s name. To include a bank account, you “fund” the trust by retitling the account so the trust, rather than you personally, is the legal owner on the bank’s records. You serve as trustee during your lifetime, so you still manage the money, make deposits, and write checks as usual.
When you die, a successor trustee named in the trust document takes over and distributes the funds according to the trust’s instructions. To gain access, the successor trustee usually presents the bank with a certification of trust (a short summary that confirms the trust exists, identifies the current trustee, and lists their powers) along with a death certificate. The bank does not see the full trust document, and the certification does not reveal the beneficiaries or distribution terms.
A trust also covers incapacity. Because the trust already owns the account, your successor trustee can step in and manage the funds without a court appointing a conservator. That dual coverage of death and disability is the main advantage over a POD.
The tradeoff is cost and diligence. Setting up a revocable trust typically means working with an attorney, and you have to remember to retitle every account and asset into the trust’s name. An account you forget to fund stays in your personal name and can end up in probate anyway.
If Your Beneficiary Is a Minor
Banks generally will not hand account funds directly to someone under 18. If a minor is named as a POD beneficiary, the money may end up in a court-supervised blocked account or guardianship, which reintroduces much of the delay and expense you were trying to avoid.
One fix is to name a custodian under your state’s version of the Uniform Transfers to Minors Act (UTMA). The typical wording on the form is: “[Custodian’s Name] as custodian for [Minor’s Name] under the [State] Uniform Transfers to Minors Act.” The custodian manages the money on the child’s behalf until the child reaches the age set by state law, usually 18 or 21. If your bank’s POD form does not accommodate a UTMA designation, a revocable trust naming the minor as a beneficiary, with a trustee managing the funds, is a reliable alternative.
When a Bank Account Can Still Land in Probate
Non-probate designations are not bulletproof. A few situations pull the money back into the court process:
- No surviving beneficiary. If every named POD beneficiary has died before you and the form was never updated, the account reverts to your probate estate.
- Unfunded trust. If you created a living trust but never retitled a bank account into it, that account stays in your personal name and goes through probate.
- Creditor claims against a thin estate. Under the Uniform Probate Code, adopted in whole or part by many states, when your probate estate cannot pay your outstanding debts, creditors can reach funds that transferred through PODs, joint accounts, and other non-probate mechanisms. The recipients may be required to contribute a proportionate share toward the remaining claims. A POD beneficiary who collected $50,000 could later be asked to return part of it if the estate cannot cover your medical bills or credit card debts.
Setting the Designations Up at the Bank
Adding a POD beneficiary or a joint owner is straightforward, but the bank needs accurate identifying details for each person you name:
- Full legal name matching government-issued identification exactly.
- Social Security number for tax reporting and to verify identity when the beneficiary claims the funds.
- Date of birth used alongside the Social Security number for identification.
Most banks use a standardized beneficiary designation form. Some let you complete it online through a secure portal; others require an in-person branch visit where a bank officer or notary witnesses your signature.3Capital One. Manage Account Beneficiaries If notarization is required, many banks provide it at no charge, and remote online notarization is available in a growing number of states.
For a living trust, the bank will ask for a certification of trust rather than the full document. It confirms the trust’s existence, the date it was created, the identity of the current trustee, and the trustee’s powers, without disclosing how the money will eventually be distributed.
Once the bank processes the paperwork, request written confirmation, either a revised statement or a beneficiary acknowledgment letter, and keep a copy with your estate planning documents. A designation at one bank does not carry over to another, so repeat the process at every institution where you hold accounts.
A Bonus: More FDIC Coverage
Naming POD beneficiaries can expand your FDIC deposit insurance. A standard individual account is insured up to $250,000. Once you add POD beneficiaries, the account qualifies for $250,000 in coverage per beneficiary, up to a maximum of $1,250,000 with five or more beneficiaries.4Federal Deposit Insurance Corporation. Your Insured Deposits Naming three beneficiaries on a single POD account, for example, gives you up to $750,000 in FDIC protection at that bank. The expanded coverage applies per ownership category at each insured bank, so for large balances, careful beneficiary designations are a real way to push protection above the standard limit.