The Importance of POD (Pay on Death) Designation
What a Difference Having a POD Can Make!
We at ELET specialize in planning for the future, but we also handle situations where there has been little to no planning, and believe me, your family will greatly appreciate a little planning on your part. As a courtesy to those poor family members who are left to figure out your estate after you’re gone, consider these bare minimum plans everyone should make while they can. With few exceptions, everyone should have a POD (pay on death)[1] designation on their accounts along with a Will. When’s the last time you checked your bank accounts to confirm that there is a POD designation and that it’s the right person?A POD makes a huge difference. Instead of months of waiting and signing forms and notarizing forms and calls to an attorney, it is a simple trip to the bank, and your beneficiary gets the funds. No probate, no court orders, no creditor waiting period – just a check in the hands of the person you want to receive it. The more assets you can distribute through PODs, the easier the entire process is for your family.Check your accounts and make sure you have designated the right person to receive the funds after you die. If you do that for all of your accounts, then you may be able to avoid the complexity of probate for your family.The second item is a Will. This is the document where you direct who gets what when you die. Not all Wills have to be probated. There are simpler processes like Small Estate affidavits and Muniments of Title that can be used when probate is not required. But its best to have a Will so that all of the options are available to your family if needed.As an attorney, I think Wills should be drafted by an attorney, but admittedly I’m biased. A person can do their own Will, but I’ve had to try to probate a couple of these DIY Wills, and frankly, it’s a mess most of the time. If you are dead set (pun intended) on doing your own Will, then please at least do the following to avoid problems down the road:
- You can handwrite your Will – BUT, if you do, it has to be ENTIRELY in your own handwriting, and you MUST SIGN IT AND DATE IT. Do not type it out and sign it. At that point, it’s no longer a “holographic” Will and you will have to meet the requirements in No. 2 below.
- If it’s typed out, then you need three people to execute it. You need a notary and then you need two witnesses. All of you need to sign in the PRESENCE AND HEARING of each other. The notary should be present too.
The notary is there is notarize the SELF-PROVING AFFIDAVIT that needs to be stapled to the Will. This is an important piece of the puzzle. Do not skip this step.In the olden days, when a Will was probated, the witnesses got hauled into court to testify about the execution of the Will so it could be proven. The legislature decided a while back that this was a whole lot of trouble, so they changed the statute to allow for a “self-proving affidavit”. This affidavit must meet the requirements of T.C.A. §32-1-104(a). Once you and your witnesses have signed the Will and the affidavit, and the affidavit it’s been notarized, you are finally done. Put the original somewhere safe and tell someone where it is.Just in case they are needed later, please have your witnesses print their name, address, and phone number clearly and legibly either on the affidavit in the space provided, or a separate piece of paper. The attorney who has to probate your DIY Will will thank you.[1] Some institutions call these TODs or transfer on death designations.By ELET Elder Law Attorney Patty Crotwell
