Estate Planning FAQs, Part 1 of 2: Managing Your Assets
When it comes to estate planning, the questions I get cover just about everything—but one topic always stands out: account ownership and asset management. People want to know how their accounts should be titled and who should have access. And here’s the deal: this isn’t just about convenience. It’s about making sure your assets transfer seamlessly to your loved ones while staying protected from unnecessary risks.
In this first part of a two-part series, I’m tackling your top questions about asset ownership and management. We’ll cover the essentials of setting things up so your family has it easy when the time comes. Ready to dig in? Let’s start with a common question about joint assets.
Q: How does joint ownership differ from a transfer-on-death designation?
A: With joint ownership, both parties have equal access to and ownership of an account or property while they’re alive. If one owner passes away, the surviving owner automatically takes full ownership. While this setup might seem simple, it comes with risks—any joint owner can withdraw all the funds at any time, and the account or property could be exposed to their creditors or legal issues.
In contrast, a transfer-on-death (TOD) or payable-on-death (POD) designation allows you to retain sole control over your assets during your lifetime. The beneficiary you name has no rights or access while you’re alive, but they’ll automatically inherit the assets after your death, skipping the probate process. This structure protects your assets while you’re alive and simplifies their transfer after your passing.
One critical consideration: Whether it’s a joint owner or a TOD/POD beneficiary, the person you name will inherit everything in the account or property outright—regardless of family dynamics or their financial habits. This can sometimes create conflict or lead to irresponsible handling of a windfall inheritance. For example, lawsuits often arise among siblings when a caretaker sibling inherits everything in a parent’s account or takes sole ownership of real estate, bypassing equal distribution.
If this is something you’re worried about, there are options to safeguard your legacy. Book a call with me to learn more about how to protect your assets and your family’s harmony.
Q: If I own property jointly or have a TOD/POD designation, do I still need a Trust?
A: While joint ownership or TOD/POD designations may seem like simple alternatives to setting up a Trust, they come with potential pitfalls that could create big headaches.
Joint Ownership Risks:
Jointly owned property is vulnerable to the creditors of either owner. For instance, I had a client—a granddaughter—who was listed as a joint owner on her grandma’s bank account. When the granddaughter’s husband defaulted on a copier contract for his business, the copier company sued and won a judgment against him. Suddenly, grandma’s account was garnished because it was held jointly, making it fair game for the granddaughter’s liability.
TOD/POD Risks:
Using TOD/POD to bypass joint ownership can help avoid creditor issues, but it doesn’t account for incapacity or unexpected changes in circumstance. TOD/POD designations only kick in at death, leaving a gap if the owner becomes incapacitated. Worse, they can result in assets being distributed in ways you didn’t intend. For example, imagine grandma names her grandson as the TOD beneficiary of her house. If grandma and grandson are in an accident, and grandson dies first, grandma might not have time to update the TOD designation before her own death. In that case, the house would go through probate and be distributed according to state intestacy laws—likely to people grandma didn’t want inheriting it.
The Better Solution: A Trust
Avoid the traps of joint ownership or TOD/POD by setting up a Trust. By retitling your assets into the Trust, everything can be managed privately, seamlessly, and according to your wishes, even in cases of incapacity or unexpected events. With a Trust in place, your loved ones can avoid probate, protect assets from creditors, and carry out your intentions without confusion or conflict.
Q: How are retirement accounts and life insurance policies handled after death?
A: Retirement accounts and life insurance policies are typically passed directly to your named beneficiaries, bypassing probate and overriding any instructions in your will—provided you’ve named beneficiaries and haven’t listed a minor. This makes it essential to keep your beneficiary designations up to date. If your designations are outdated—like naming an ex-spouse or a deceased person—your assets may not go where you intend.
Even worse, if no beneficiary is listed, these accounts will go through probate, creating unnecessary delays and expenses for your loved ones. If you’ve named a minor as a beneficiary, the assets will be tied up in a court-supervised process until the minor reaches the legal age of adulthood, which is typically 18 or 21, depending on state law. This is why careful planning is so important!
Q: Is it necessary to create an inventory of my assets?
A: Absolutely—and it’s crucial to keep it updated. At our firm, we include an asset inventory as part of all our planning options because it’s one of the most essential steps in the estate planning process. Surprisingly, traditional estate plans from lawyers or legal insurance plans often skip this step, leaving families to struggle.
Our Planning Session process includes a detailed inventory of your assets so your loved ones know exactly what you own, where to find it, and how to access it quickly and cost-effectively. Without an inventory, your family may overlook valuable assets, which could end up in your state’s treasury as unclaimed property.
In fact, according to the National Association of Unclaimed Property Administrators, about 1 in 7 Americans—roughly 33 million people—have unclaimed property, totaling a staggering $77 billion dollars. If you want your assets to go to your loved ones or favorite charities instead of your state’s unclaimed property fund, creating and maintaining an asset inventory is a must.
Q: How frequently should I review my asset inventory and account designations?
A: It’s crucial to keep your inventory and beneficiary designations updated over time to reflect your current circumstances at the time of your death. My Estate Planning® process includes regular, ongoing reviews of your asset inventory to ensure no asset ever gets overlooked.
You should also update your asset inventory and account designations whenever a major life event occurs, such as:
Marriage or divorce
Birth or adoption of a child
Death of a beneficiary
Purchase or sale of significant assets
Moving to a new state
Starting a business
Retirement
When you work with me, you won’t need to remember these updates on your own. I’ll proactively remind you to update your inventory and beneficiary designations, and I’ll make the process as simple as possible for you to take action.
Q: What’s the most effective way to organize and store my asset information?
A: Establish a simple, well-organized system that your loved ones can navigate easily if something happens to you. Remember, sensitive details like passwords don’t belong in your will—they’ll become public record after your passing. Instead, secure this information in a safe location and make sure your trusted family members, executor, or trust administrator know where to find it. When we work together, I’ll help you craft a plan that keeps your asset information protected yet accessible when it’s needed most.
How We Help You Stay Prepared and Secure
Let’s get real—estate planning isn’t just about having a will. At 20West Legal, your Personal Family Lawyer® Firm, we help you go beyond the basics to create an Estate Plan that actually works when your family needs it.
Based in Sudbury, Massachusetts, we’ll create a customized plan that includes a complete asset inventory, proper account titling, and coordinated beneficiary designations. Not sure what all that means? Don’t worry—I’ll guide you through it all, explaining how different ownership structures impact your goals and ensuring your plan fits your family’s unique situation.
And the best part? We don’t just set it and forget it. Through regular reviews, we’ll make sure your plan stays updated and continues to do what it’s supposed to—get your assets to the people you want, in the way you want.
Ready for peace of mind? Schedule your complimentary 15-minute consultation today: https://go.20westlegal.com/meeting-scheduler
This article is a service of 20WestLegal LLC. We don't just draft documents; we ensure you make informed and empowered decisions about life and death for yourself and the people you love. That's why we offer a Planning Session, during which you will get more financially organized than you've ever been before and make all the best choices for the people you love. You can begin by calling our office in Sudbury, Massachusetts today to schedule an Estate Planning Session and mention this article to find out how to get this $750 session at no charge.
The content is sourced from Personal Family Lawyer® for use by Personal Family Lawyer® firms, a source believed to be providing accurate information. This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal, or investment advice. If you are seeking legal advice specific to your needs, such advice services must be obtained on your own separate from this educational material.