A trust is a legal entity that can hold a variety of assets, from financial accounts to physical property, for the benefit of another or others. And it can accomplish this while bypassing probate, the often costly, lengthy, and stressful legal process of having the court decide how to distribute your assets upon death.
This is one of the major reasons why people make trusts a part of their estate planning arsenal. However, setting up a trust can be complex and expensive. It can also be difficult to manage and maintain even if you pass on these duties to a designated trustee.
If your main goal is to avoid probate, there are potentially simpler and less costly options out there. So let’s take a closer look at these.
POD and TOD Accounts
If you just want to easily transfer assets held in a bank account to a designated beneficiary, a payable-on-death (POD) designation on this account can do the trick.
POD designations can be added to various bank accounts such as checking accounts, savings accounts, certificates of deposit (CDs), and money market accounts.
But you may also have heard of transfer-on-death (TOD) accounts. These designations particularly apply to brokerage accounts that hold securities like stocks, bonds and ETFs.
But beyond the types of financial accounts they deal with, POD and TOD designations work similarly.
You can set either up by contacting your financial institution and filling out a form. On this form, you’d list a designated beneficiary or beneficiaries as well as information such as their Social Security or tax ID numbers.
Upon your death, your beneficiaries would need to present a death certificate and validate their identities with the financial institution. Afterward, they would receive the assets held in these accounts.
POD and TOD accounts are simple to set up, and both bypass probate. But they’re generally designed for smaller and less complex estates.
Additionally, beneficiary designations that bypass probate exist outside of POD and TOD accounts.
You can designate beneficiaries for retirement accounts like 401(k)s and IRAs, as well as life insurance policies.
Joint Tenants With Right of Survivorship
Joint Tenants With Right of Survivorship (JTWROS) is a legal arrangement that allows two or more people to own equal shares of an asset. Upon one owner’s death, their share is automatically transferred to the surviving owner without the need for probate.
Assets involved in a JTWROS can range from financial accounts to physical property like real estate.
To set up a JTWROS properly, all co-owners must meet what is called the four unities.
- Co-owners must acquire the assets in question at the same time.
- Co-owners must have the same title on the asset.
- Each owner must have an equal share of the total assets.
- Co-owners must each have the same right to possess the entirety of the assets.
Tenancy by the Entirety
Tenancy by the entirety allows spouses to own property as a single legal entity. This creates a right of survivorship. So when one spouse dies, the surviving spouse automatically gets the full title to the property while bypassing probate.
Plus, creditors cannot enforce a lien on any property under a tenancy by the entirety when only one spouse owes the debt.
However, this strict form of mutual ownership means that both spouses must be on the same terms when it comes to how to manage the property. One spouse, for example, can’t legally sell off or develop a portion of the property without the other’s consent.
It’s important to note that this arrangement isn’t available throughout the country. Still, about half of U.S. states allow tenancy by the entirety.
The Bottom Line
A trust is often seen as an iron-clad estate planning tool that can bypass probate. But while trusts can offer major benefits, they may not be for everyone. They typically fit larger and more complex estates. And setting up a trust can be costly and time consuming. But there are other ways to transfer assets while bypassing probate that may be simpler. If you want to transfer financial accounts, you can look into POD and TOD designations. And if you want to transfer co-owned assets like financial accounts and physical property, you can consider a JTWROS. And married couples who own property can consider tenancy by the entirety if it’s allowed in their state.
The Epoch Times copyright © 2026. The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.
