Account Registrations and Beneficiary Designations: when incorrect and how to fix it

When you have financial accounts (investment, banking, CDs, crypto) it is really important that you know and understand two things: 1) how the account is titled; and 2) who the beneficiary is on that account.

Account registrations are how the account is titled. If you have a trust you can title brokerage accounts, CDs, and general investment accounts either in your own name or in the name of the Trust. Titling your account in the name of the Trust is our preferred designation but you may use transfer-on-death designations if you prefer.

Incorrect account registrations and beneficiary designations happen quite often. Mistakes or changes can be corrected by reaching out to the financial institution. You may just need to schedule an appointment with them, access your account online, or fill out a form to make the correction. Or, simply call our office.

If the incorrect account or beneficiary designation is caught after you pass away, and that account is left in just your name after you pass, then some form of probate administration or court proceeding may be required to correct the error and transfer that asset to your family.

I see this happen when an individual has several different accounts in several different places, and it simply slips their mind to update incorrect or outdated information, or they don’t quite know the difference of how being named on an account can affect your access. For instance: if you are married, have a separate account from your spouse, and simply list your spouse as a signor and not as a joint owner or POD (Pay on Death-designee). When you pass, your spouse automatically then loses access to that account.

That is why we regularly have these discussions with clients and ask them to meet with us every 3-5 years: we can review everything and make sure their estate plan is current.