A POD is a way to name someone to receive your money after you die
POD stands for "payable on death." It is a designation you can add to a bank account, savings account, or certificate of deposit (CD) that automatically transfers the money to a named person when you pass away. The person you name—called the beneficiary—receives the funds without the account going through probate, which is the court process that normally handles a dead person's property.
When you die, the bank verifies your death through a death certificate, and the money moves directly to your beneficiary. This happens outside of your will and outside of court. The beneficiary does not own the account while you are alive—you keep full control, can spend the money, close the account, or change the beneficiary at any time.
Key Takeaways
- A POD designation names someone to receive your account balance automatically after you die, without probate court involvement.
- You keep complete control of the account during your lifetime and can change or remove the beneficiary whenever you want.
- The beneficiary has no claim to the money while you are alive, even if the account is in both your names.
- Most banks offer POD at no extra cost, and you can set it up when you open the account or add it later.
- A POD does not override a will or trust—if your will names a different person to receive the account, the POD takes priority.
How to set up a POD on your account
Contact your bank and ask to add a POD beneficiary to your account. Some banks let you do this online through your account settings; others require you to visit a branch or call. You will need to provide the beneficiary's full legal name and usually their Social Security number or date of birth so the bank can identify them correctly.
There is no cost to add a POD. The bank will give you a form to sign, and once it is processed, the designation takes effect immediately. You can name one person or multiple people. If you name more than one, you typically choose whether they split the money equally or whether one person gets priority.
Keep a copy of the POD form for your records. If you move banks or close the account, the POD does not carry over—you will need to set up a new one at your new bank if you want the same protection.
POD versus joint account: what is the difference
A joint account is owned by two or more people during their lifetimes. Both owners can deposit and withdraw money, and both names appear on the account. When one owner dies, the surviving owner automatically owns the entire account—this is called right of survivorship.
A POD account belongs only to you while you are alive. The beneficiary has no access and no ownership rights until you die. You can spend all the money, and the beneficiary cannot stop you. With a joint account, the other owner can withdraw money at any time, which means your money is not fully under your control.
A POD is often simpler for this reason: you keep the money yours, but you may provide it goes to someone specific after you die. A joint account is useful if you want someone to have access to the money right now—for example, a spouse or adult child who helps pay bills.
What happens to a POD account after you die
When you die, your beneficiary contacts the bank with a copy of your death certificate. The bank verifies the death and confirms the POD designation in their records. The beneficiary then provides identification and completes a claim form. The bank transfers the account balance to the beneficiary, usually within one to three weeks, though this varies by bank.
The beneficiary receives the money as a lump sum, not in installments. They can then deposit it into their own account or use it however they choose. The original account is closed.
If your beneficiary dies before you do, the POD becomes void. The money will not go to the beneficiary's heirs—it will become part of your estate and be handled according to your will or state law if you have no will.
POD does not replace a will or trust
A POD is one tool for passing money to someone, but it only covers that specific account. If you have other assets—a house, a car, investments, personal property—those are handled separately through your will or trust. A POD account bypasses probate for that one account only.
If you have a will that says your money should go to your child, but your bank account has a POD naming your spouse, the POD takes priority. The spouse gets the account; your child gets nothing from it. This is why it matters to keep your POD, will, and any trusts aligned with what you actually want.
Some people use PODs on checking and savings accounts but set up a trust for larger assets like real estate. Others use PODs as their main estate plan if they do not have much property. There is no single right approach—it depends on what you own and who you want to receive it.
Taxes and POD accounts
The money in a POD account is part of your taxable estate for federal estate tax purposes, even though it does not go through probate. If your total estate is large enough to owe federal estate tax, the POD account counts toward that total. Most people's estates are not large enough to trigger federal estate tax, so this is not a concern.
The beneficiary does not owe income tax on the money they receive from a POD account. It is not considered income—it is a transfer of your property. However, if the account earned interest before you died, that interest may be taxable to your estate.
Frequently Asked Questions
Can I name more than one beneficiary on a POD account?
Yes. Most banks let you name multiple beneficiaries and specify how they split the money—usually equally, or in percentages you choose. If one beneficiary dies before you, their share typically goes to the surviving beneficiaries unless you set it up differently.
What if I change my mind about who the beneficiary is?
You can change or remove a POD beneficiary at any time during your lifetime. Contact your bank, fill out a new form, and the change takes effect once the bank processes it. The old beneficiary has no claim to the money once the change is official.
Does a POD account go through probate?
No. That is the main reason people use PODs. The money transfers directly to the beneficiary based on the bank's records, without court involvement. This usually makes the process faster and less expensive than probate.
What if I die without naming a beneficiary?
The account becomes part of your estate and is handled according to your will or state law. It will go through probate unless you have other arrangements in place, like a trust.
Can a creditor or debt collector take money from a POD account?
Once you die, the money belongs to the beneficiary, and creditors generally cannot take it. However, if you owe taxes or have unpaid child support, the government may have a claim against your estate before the POD transfer happens. The rules vary by state and situation.