One often overlooked estate planning tool is a simple Totten trust. Also known as payable-on-death accounts, they can add privacy to your estate plan.
Below is some important information to anyone looking for nontraditional options for their comprehensive estate plan.
Beneficiaries have no access until account owner dies
This is very important to some estate planners. They don’t want their beneficiary to access or control the funds until they have passed on, and Totten trusts neither go through probate nor are connected to the estate itself.
Totten trusts allow for private bequests
If you have had an important relationship during your lifetime that falls outside of traditional heirs and beneficiaries, you can use a Totten trust to ensure that they are not entirely overlooked when you die.
Think favorite employees, lifelong friends, children conceived with other partners — the possibilities are extensive.
Beneficiaries can be changed
Maybe you fell out with the person you designated as the beneficiary of the account. Just visit your bank branch and change the beneficiary on the account. Since you control all aspects of the account during your lifetime, you can make deposits and withdrawals, change the beneficiary and even close the account entirely if you choose.
Address this need with your estate-planning professional
If you like the appeal of a Totten trust, a good plan of action is to speak to your estate-planning professional, who can offer you guidance on the best ways to integrate a Totten trust into your estate plan. Learning more about the options you have can be very helpful.