Under Missouri law, things like stock certificates, insurance agreements, bonds and bank accounts are considered non-probate transfers when a person dies. People commonly refer to these paid benefits as payable on death (POD). This means that they can be distributed to your family, friends or loved ones immediately and without having to go through probate court. All you have to do is designate a beneficiary. This is usually done on a beneficiary designation form. Every bank uses these and they typically look like every other form that you fill out when you open a checking or savings account.
So what’s the problem? If you don’t designate a beneficiary, the money in your account goes into probate, making the process time consuming and possibly expensive. In my experience, people with accounts at large institutions like Bank of America commonly do not have a beneficiary designation form on file. This can become a huge problem as families tend to rely on this money for expensive end of life costs.
So what can you do to prevent this? Go to your bank or insurer and verify that you have a beneficiary designation form on file and that it is properly filled out. You should also make sure that it lists the proper beneficiary. For example, my beneficiary designation at age 29 is different than it was at 18, when I first opened my bank account and filled out a beneficiary designation form.
It is very important that your beneficiary designation forms are properly filled out and accurately reflect your wishes for when you pass.
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