Reduce hassles for heirs with TOD agreement

Excerpt from Lahontan Valley News: (click for entire article)

Among the reasons you work hard all your life may be so you can leave something to your children, grandchildren or other family members. So, naturally, you'd like to make it as easy as possible for your heirs to take possession of those assets you want them to have. And that's why you may want to consider establishing a Transfer on Death (TOD) agreement on certain accounts.

Once you've established a TOD agreement for your account, ownership of the assets held in that account pass directly to the designated beneficiaries, bypassing probate. Why is this important? Because probate has three major drawbacks:

• It's time-consuming. If your estate has to go through the probate process, it could easily take a year or more for your assets to be distributed to your heirs.

• It's expensive. Attorney and court fees could devour up to 5 peercent of your estate's value — which means fewer assets going to your loved ones.

• It's public. The probate process is open to everyone. This means anyone can obtain a copy of your will, the names and contact information for your heirs, the inventory of assets and other documents filed as part of the probate proceeding.

As you can see, you've got some good reasons to avoid probate — and a TOD agreement can help. Of course, a TOD agreement can't meet all your estate-planning needs. While it may be particularly useful in helping you bequeath specific financial assets, such as stocks, bonds and other assets held in your brokerage accounts, it can't help you deal with estate taxes or address other complex estate-planning issues.

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