Let’s Transfer Everything on Death

We are often asked about Transfer on Death Designations (TODs). The Missouri Bar Association lead the charge nationwide to allow for easy transfer of assets from a deceased person to one or more beneficiaries. The efforts of the Missouri Bar allow us to make those transfers with virtually any asset, whether real estate, stocks, bonds, or bank accounts. However, the transfer on death law was never intended to replace a complete estate plan. Checkett & Pauly frequently uses transfer on death devices in estate plans but not for everything across the board. While transfer on death designations assist in many situations, they do not manage assets if you become incapacitated during lifetime or someone dies before they are supposed to.
For instance, if a transfer on death designation is used as the sole estate planning device but the client becomes incapacitated, a court ordered guardianship is the only alternative to handle those assets. If you leave real estate or bank accounts to your, but they die before you, a problem is immediately created for deceased child’s share; does it go to brothers and sisters or to grandchildren? Do the grandchildren get the assets when they are five years old or when they are fifty years old? Checkett & Pauly is certainly grateful that the Missouri Bar created such an easy and inexpensive estate planning device like the transfer on death designation. It is not, however, an appropriate way to completely plan your estate.