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What is POD?

What does the P.O.D stand for when it appears on a bank account that you did not open in your name?


P.O.D. is an abbreviation that is used to designate a bank account as "payable on death" of the owner. The P.O.D. designation is usually followed by the name of the named beneficiary. Under the law in many states, arranging for one's deposit account to be titled in this way is a very convenient way to transfer ownership of the account to the named beneficiary upon one's death. The account doesn't become part of one's estate, and the beneficiary doesn't have to depend upon the machinery of probate to gain ownership of the funds in the account.

In some cases, an account owner will notify the named beneficiary that the account exists and includes the P.O.D. designation. In other cases, an account owner will guard that information carefully, not wanting the beneficiary to know about it until the owner's death. In either case, the account owner has the right to revoke the designation or to name a different beneficiary altogether, and can exercise that right until the moment of death. In other words, the named beneficiary generally has no "right" to the account until the designation simply cannot be revoked, so you may not have opened the account, but it could be that someone has decided that you (at least for now) should get whatever is in the account when he or she dies.

Published on 12/11/06