Be Aware to Whom You Bequeath Your Nest Egg AARP Michael T. Palermo

Be Aware to Whom You Bequeath Your Nest Egg

My father’s will named me executor and divided his estate equally among my brother, my sister, and me. So I was surprised to find he had a bank certificate of deposit payable on death (POD) to me alone. None of his other accounts was POD. Someone at the bank probably suggested he use the POD designation as a way of avoiding probate. Dad did not hear well, and he may have just nodded when the bank employee made the suggestion. I knew very well, however, that my father did not intend to give this CD only to me. But by using a POD instrument, that’s precisely what he did. Unlike his other property, the CD was not subject to probate. I would have been within my rights to pocket the money—with or without the knowledge of my brother and sister. They could have then gone to court, arguing that a mistake had been made—that my father lacked the required intent to make a gift of the entire CD to me. That’s the truth of the matter, yet it would have been almost impossible to prove. Instead, I cashed in the CD and gave one-third of the proceeds each to my brother and sister. We’re a close family, so the decision was automatic, but I’m sure Dad didn’t buy that CD because he was counting on me to be fair and share the money—he just made a mistake. Beware of this kind of situation; the potential for a family feud is obvious. From “AARP Crash Course in Estate Planning: The Essential Guide to Wills, Trusts and Your Personal Legacy,” by Michael T. Palermo, JD, CFP, 2005, pp. 20-21. Cancel You are leaving AARP.org and going to the website of our trusted provider. The provider’s terms, conditions and policies apply. Please return to AARP.org to learn more about other benefits. Your email address is now confirmed. You'll start receiving the latest news, benefits, events, and programs related to AARP's mission to empower people to choose how they live as they age. You can also by updating your account at anytime. You will be asked to register or log in. Cancel Offer Details Disclosures

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