||Ask Dr. Don
Using 'payable on death' to
Dear Dr. Don,
To avoid probate, can my husband and I purchase a Series
EE U.S. savings bond in both our names and put "upon death"
on it so it can go directly to a child?
You can have a savings bond held in both of your names that
includes a "payable on death" notation.
That will effectively eliminate the need for the savings
bond to be included in probate, although the proceeds would still
be included in your estate after your deaths.
See the Bureau of Public Debt's Web pages, Death
of a Bond Owner and What
to Do When a Bond Owner Has Died.
Not all states have passed "payable on death"
or "transfer on death" laws. If your state doesn't have
such a law then I'm uncertain how a financial obligation of the
federal government is treated under state law and you'd want to
review this decision with your attorney.
The map below shows states that have passed such laws:
Today article has more on "payable on death" accounts
and when you should consider using them to transfer ownership of
bank accounts, savings bonds and U.S. Treasury securities upon the
death of the owner.
-- Posted: Aug. 5, 2003