What Is a Totten Trust?

When you are planning what will happen to your bank accounts after you pass away, you may come across the term “Totten Trust.” It sounds technical, but it’s actually a fairly simple way to pass money to someone without going through probate. Understanding how a Totten Trust works can help you decide if it fits into your estate plan in Hershey.

A Totten Trust is sometimes called a “payable-on-death” (POD) account. It isn’t a traditional trust with a trustee and a lengthy document. Instead, it is a bank account you set up in your own name for your benefit during your lifetime, but you also name a beneficiary who will receive what’s left in the account when you die.

The account title usually includes language like “in trust for” or “payable on death to” followed by your beneficiary’s name. During your life, you can deposit, withdraw, and use the money however you want. The beneficiary has no rights to the funds until after your passing.

How Does a Totten Trust Work for Hershey Residents?

For individuals and families in Hershey, a Totten Trust can be a convenient way to make sure a loved one receives money promptly. After your death, the beneficiary usually just needs to provide identification and a death certificate to the bank. The funds in the account then transfer directly to them outside of probate, which can save time and reduce legal costs.

You can change the beneficiary, close the account, or move the funds at any time while you’re alive. That flexibility is one of the main reasons many people use Totten Trusts as part of their broader estate plan. However, it’s important to coordinate these accounts with your will and any other planning tools so everything works together.

Pros and Cons of Totten Trusts in Hershey Estate Planning

Totten Trusts offer several advantages:

• Avoiding probate for that specific account
• Relatively simple setup at your bank
• Continued control of your money during your lifetime

But there are also limitations:

• They only cover the specific account, not all your assets
• They can unintentionally conflict with what your will says
• They don’t address complex goals, like planning for minors or beneficiaries with special needs

Because of these issues, Totten Trusts are best used as one piece of a thoughtful estate plan, not a complete solution.

Talk to a Hershey Estate Planning Attorney at Audi Law PLLC

If you are wondering whether a Totten Trust is right for your situation, you don’t have to figure it out alone. The estate planning attorney at Audi Law PLLC in Hershey can review your accounts, your goals, and your family’s needs, then help you design a plan that truly protects your loved ones.

Call Audi Law PLLC or contact the firm through the website today to schedule a consultation and take a confident step toward a clear, well-organized estate plan.