Bank accounts go through probate only if they're held in the deceased person's name alone with no beneficiary designation
A bank account avoids probate if it has a payable-on-death (POD) beneficiary, is held as a joint account with right of survivorship, or is in a living trust. If the account is in the deceased person's individual name only, with no beneficiary named and no co-owner, the probate court must oversee its transfer to heirs. The path the account takes depends entirely on how the title is set up—not on the bank, the amount of money, or the state where the person lived.
Understanding which accounts avoid probate matters because probate freezes access to money for weeks or months, makes the account details public, and costs time and sometimes money in court fees. The person who died may have set up the account to avoid probate years ago, so checking the account title and beneficiary forms before assuming probate is required can save the family significant delay.
Key Takeaways
- Bank accounts with a named POD beneficiary pass directly to that person outside of probate, usually within days of providing a death certificate.
- Joint accounts with right of survivorship transfer automatically to the surviving co-owner and do not enter probate.
- Accounts in a living trust avoid probate because the trust, not the person, owns the account.
- Accounts held only in the deceased person's individual name with no beneficiary or co-owner must go through probate before heirs can access the money.
- Check the account title and beneficiary forms before assuming probate is required, because the person who died may have set this up years ago.
How payable-on-death beneficiaries work
A POD beneficiary is the simplest way to keep a bank account out of probate. When you name a POD beneficiary on a savings or checking account, that person receives the money directly when you die—the bank handles the transfer without court involvement. You can name one person or multiple people, and you can change the beneficiary at any time while you're alive.
To claim the money, the beneficiary brings the death certificate and a completed claim form (which the bank provides) to the bank. Most banks process POD transfers within three to five business days. The money goes to the beneficiary, not to the estate, so it does not pass through probate and is not subject to claims from creditors or other heirs.
POD accounts are sometimes called "Totten trusts" in legal documents, but the bank will call it a payable-on-death account. Check your account statements or contact your bank to see if a POD beneficiary is already named. The beneficiary designation is usually listed on the account agreement or can be found by asking the bank directly.
Joint accounts with right of survivorship
A joint account with right of survivorship passes automatically to the surviving co-owner when one owner dies. The surviving owner already has legal claim to the entire balance, so probate is not needed. This is different from a joint account without survivorship rights, which would require probate to transfer the deceased owner's share.
Most banks set up joint accounts with survivorship rights by default, but you should confirm this with your bank. Ask whether the account is titled "joint tenants with right of survivorship" or "joint tenants in common"—only the first one avoids probate. The surviving co-owner can continue using the account immediately after providing a death certificate to the bank.
Joint accounts do carry a risk: both owners have full access to all the money during life, and creditors of either owner can potentially reach the account. If the account was set up only to avoid probate and not for day-to-day shared use, a POD beneficiary or living trust may have been a better choice.
Bank accounts held in a living trust
When a bank account is retitled in the name of a living trust, the trust owns the account rather than the individual. Because the trust is the legal owner, the account does not go through probate when the person who created the trust dies. Instead, the successor trustee (the person named to manage the trust after death) takes control of the account and distributes it according to the trust instructions.
Retitling an account into a trust requires paperwork from the bank—you cannot simply add the trust name to an existing account. The bank will ask for a copy of the trust document and may require a new account number. Once the account is in the trust's name, it functions normally, and you can still access and manage it during your lifetime.
Living trusts are more complex than POD beneficiaries and usually involve legal fees to set up, but they offer more control over how money is distributed and can manage multiple accounts and assets in one document. A trust also provides privacy, since trust transfers do not go through public probate court.
Accounts that must go through probate
An account goes through probate if it is titled only in the deceased person's individual name, has no named beneficiary, and is not part of a trust. The probate court appoints an executor (if there is a will) or an administrator (if there is no will) to manage the account. The executor or administrator must locate the account, secure it, pay any valid claims against the estate, and then distribute the remaining balance to heirs according to the will or state law.
Probate for a bank account can take anywhere from a few weeks in simple cases to several months or longer if there are disputes, debts, or taxes to settle. During probate, the account is frozen and heirs cannot access the money. The probate process is public, meaning anyone can look up the details of the estate and the account balance.
If the deceased person had multiple accounts in their individual name, each one must be accounted for in probate. This is one reason financial advisors recommend naming beneficiaries or using a trust—it speeds up access to money for the people who need it and keeps the details private.
What happens if there is a will but no beneficiary named
A will does not prevent probate. Even if the deceased person left a will that says "my bank account goes to my daughter," the account still goes through probate because there is no beneficiary designation on the account itself. The will tells the probate court what to do with the account, but the court must still oversee the transfer.
This is a common source of confusion: a will and a beneficiary designation are two different legal tools. A beneficiary designation on the account itself (like a POD) bypasses probate entirely. A will does not. If someone wants to avoid probate, they need to set up the account with a beneficiary, a co-owner, or a trust—not just write it into a will.
Some people update their will but forget to update the beneficiary forms on their bank accounts. When this happens, the beneficiary designation on the account takes priority over what the will says. The account goes to whoever is named as the POD beneficiary, not to whoever the will names.
How to learn about an account has a beneficiary
If you are managing someone's finances after their death, contact the bank directly and ask whether a POD beneficiary is named on the account. You will need the account number and the deceased person's name. The bank can tell you in one phone call whether the account has a beneficiary designation and who it is.
If you are the executor or administrator of an estate, the bank may ask you to provide a death certificate and a copy of the court order appointing you before they release this information. If you are a family member but not the executor, the bank may not disclose beneficiary information due to privacy rules, but you can still ask whether the account requires probate.
Check any paperwork the deceased person left behind—bank statements, account agreements, or financial records—for clues about how the account is titled. Sometimes beneficiary forms are filed with the bank but not kept at home, so a direct call to the bank is the most reliable way to find out. Ask to speak with someone in the bank's trust or beneficiary department rather than a general customer service line.
Frequently Asked Questions
Can a POD beneficiary be changed after someone dies?
No. A POD beneficiary can only be changed by the account owner while they are alive. After death, the beneficiary named on the account at the time of death receives the money. If you believe the beneficiary was changed fraudulently or the deceased person was not mentally capable when the change was made, you may need to contest it in court, but the bank will not change it on its own.
What if someone dies without a will and the account has no beneficiary?
The account goes through probate. The probate court appoints an administrator to manage the estate, and state law determines who inherits the money—usually a spouse, children, or parents, depending on who survives. The process takes longer than a POD transfer because the court must verify the heirs and oversee the distribution.
Does a joint account avoid probate if one owner dies?
Yes, but only if the account is set up with right of survivorship. The surviving co-owner automatically owns the entire account and does not need probate to access it. If the account is titled as "joint tenants in common" instead, the deceased owner's share goes through probate. Ask your bank which type you have.
Can creditors reach a POD account after someone dies?
Generally, no. A POD account passes directly to the beneficiary and is not part of the probate estate, so creditors of the deceased person cannot claim it. However, if the beneficiary is also a creditor (for example, a child who loaned money to the parent), they may have other legal remedies. State law varies on this point.
Is a living trust better than a POD beneficiary for a bank account?
For a single account, a POD beneficiary is simpler and free. A living trust is useful if you have multiple accounts, real estate, or want more detailed instructions about how money should be distributed. A trust also provides privacy and can manage assets if you become unable to handle finances before you die. The choice depends on your situation and whether you already have a trust for other reasons.