POD Account

A POD account allows quick access to your cash in the event of your death. POD stands for payable on death and many banks will offer a POD service free of charge. A POD account ensures that your family has cash for immediate expenses without having to go through a will.

You need to have a beneficiary in order to setup a POD account. To setup your account all you need is to go to your bank and request to setup a payable on death account and fill out the required paperwork. your beneficiary will then have access to your bank accounts in the event of your death.

A POD account isn’t the same as a joint account because unlike a joint account the beneficiary can’t access your funds while you’re still alive. The bank needs proof of death in order to grant access to the beneficiary of a POD account.

Once this requirement has been satisfied the beneficiary then gains access to checking accounts, savings accounts, certificates of deposit, and money market accounts. There may be certain restrictions on account access and these rules will vary from bank to bank so be sure to know of any rules your bank may have with a POD account.

A POD account may not be an ideal account for everyone. Sometimes POD accounts can delay the beneficiary’s access to funds if there are tax issues involved with the deceased. For example the accounts may be considered a taxable estate in which case the government will need to take out taxes from the account before access is granted. A joint account might be a better arrangement because access is allowed at any point for the 2nd account holder.