Common Estate Planning Questions Part 1: How to Protect My Assets From Being Seized

Regarding estate planning, we get many questions about many topics that may be hard to talk about. One of the most common questions concerns account ownership and asset management. Understanding how accounts are titled and who can access them isn’t just about convenience. We want to ensure your assets transfer smoothly to your loved ones during the most challenging times they will face while protecting them from potential risks of Probate and creditors.

In this first installment of a two-part article series, we will answer the most common questions about asset ownership and management and ways in which you can make things easier for your family after your death. Let’s start answering the big questions to ensure we help you know what to do.

Question 1: What’s the difference between TOD (transfer-on-death) and joint ownership?

Answer: Joint ownership means both parties have full access to and ownership of a specific account or piece of real estate, while living. When one owner dies, the surviving owner receives full ownership. This can be convenient but comes with risks – a joint owner can withdraw all the money at any time, and the account could be vulnerable to a joint owner’s creditors or legal judgments.

On the other hand, transfer-on-death (TOD) or payable-on-death (POD) beneficiary designations give you sole control during your lifetime. Your designated beneficiary has no access or rights to the account while you’re alive but receives the assets upon your death. This arrangement prevents another person from accessing your assets while you’re alive and also avoids the court process (called probate) after you die.

One important note: When you have a joint owner on your account, or a designated beneficiary, that person will receive all the funds after you die, no matter how old they are or what your family dynamics are. This can create conflict in your family or can cause someone who’s fiscally irresponsible to potentially inherit a windfall with no safeguards. Lawsuits are filed all the time by disgruntled siblings who find out that the caretaker sibling receives all the money in a parent’s account (or sole title to real estate) rather than being distributed equally among all siblings. If this is a concern to you, read on to find out how you can book a call with us to learn about your options.  A common misperception is that the joint owner will share the account and follow the terms of the Will or Trust, but this asset will not pass under the Will or Trust.

Question 2: Is joint ownership, or using a TOD or POD, better than a Trust?

Answer: If you use joint ownership or TOD/POD instead of a Trust, you need to consider some traps for the unwary. First, as indicated above, jointly owned property could be at risk from creditors of either party. Example – client, granddaughter, who was titled on grandma’s bank account. When granddaughter’s husband didn’t pay his bills, creditors sued and got a judgment against him. Next thing you know, grandma’s account gets garnished because it was held jointly with granddaughter, and granddaughter was liable on her husband’s debts.

Suppose you use a TOD or POD to avoid a scenario like that. In that case, the problem is that the TOD/POD only operates in the event of death, not incapacity, and TOD/POD could result in the wrong person ending up getting the assets or the assets ending up in probate if there is an unexpected “order of death” issue. Imagine, grandma leaves house to grandson using TOD, but grandma and grandson are in the car together when there’s an accident, and grandson dies first, with grandma dying shortly thereafter, and before she could change the TOD/POD. Who gets the property, and how? In this case, the property would have to go through probate and pass to grandma’s “next of kin” according to the state intestacy statutes or under her Will. Given that grandma was leaving her property to grandson, it’s likely she didn’t want the “state’s plan” for her assets. But that’s what she’ll end up with.

The solution is not to use joint ownership or a TOD/POD to pass title to assets at your death. Instead, set up a Trust and retitle the property, and everything can be handled with ease, privately, and in our office, for the people you love.

Question 3: What happens to retirement accounts and life insurance policies after death?

Answer:  These accounts pass directly to your named beneficiaries, bypassing probate and any instructions in your Will, if you have named beneficiaries and if you haven’t named a minor as a beneficiary This is why keeping your beneficiary designations up to date is crucial. If your beneficiary designations are outdated – listing an ex-spouse or deceased person, for example – your assets might not go where you want them to or even worse, end up in probate. Additionally, if you have no beneficiary listed, these accounts will go through probate, costing your loved one’s unnecessary time and money. If you’ve named a minor as a beneficiary, the assets will be subject to a court process to hold the assets under court order until your minor beneficiary is “of age” – usually 21, depending on state law.

Question 4: How do I make a list of my assets?

Answer: We like to explain to our clients that it’s critically important that you create an inventory and keep it up to date. We include this in all of our planning options because it’s one of the most essential parts of the planning process, even though, surprisingly, it’s not part of most estate planning with traditional lawyers nor document preparers plans. Our unique process includes a Family Asset Inventory because if you don’t inventory your assets, your family will not know what you have, how to find it, and how to access it as efficiently and affordably as possible.  Lost assets end up in your state’s treasury as unclaimed property. According to the National Association of Unclaimed Property Administrators, approximately 1 in 7 people in the U.S. – or about 33 million people – have unclaimed property, totaling approximately 77 billion dollars. In Arizona, as of 1/28/2025, the total value of unclaimed property is $2.,444,138,118. If you want to ensure that your assets go to the people or charities you want rather than to your state government’s unclaimed property fund, you need an asset inventory and to ensure you title your assets correctly. And it must stay up to date.

Question 5: How often should I review my asset inventory and account designations?

Answer: Your inventory and beneficiary designations need to be kept up to date over time, so they reflect your current circumstances when you die or become incapacitated. It’s also important to update your asset inventory and account designations whenever you experience a significant life event such as:

• Marriage or divorce
• Birth or adoption of a child
• Death of a beneficiary
• Purchase or sale of significant assets
• Moving to a new state
• Starting a business
• Retirement

You won’t have to remember this alone when you work with Tritch Buonocore Law.  We will proactively remind you to update your inventory and beneficiary designations and help make it as easy as possible for you to take action.

Question 6: How Do you keep track of all your assets?

Answer: Create a transparent, organized system that your loved ones can easily access if something happens to you. This also helps make a review of your Estate Plan easier. However, be careful about including sensitive information like passwords or personal feelings in your Will, as it becomes a public record after death. Instead, consider keeping this information in a secure location and telling your trusted family members, loved ones, executors, or Trust administrators how to access it. We help you explore the best way to do this when we work together.

Need Assistance?

Here at Tritch Buonocore Law, PLLC, we take the time to understand your assets and your personal needs. We conduct a Planning Meeting to make sure there is Asset Protection within your Estate Planning, if this is a concern for you. We are here to help you and ensure you set up your legacy as you want it. For more information, contact our office at 480-525-6244 or schedule a complimentary 30-minute Meet and Greet Here.