How to Add a Beneficiary to Your Bank Account

Yes, you can name a beneficiary on most bank accounts, and it bypasses probate when you die

A beneficiary on a bank account is a person you name to receive the money in that account after you die. When you add one, the account becomes what's called a payable-on-death (POD) account or transfer-on-death (TOD) account, depending on your bank's terminology. The moment you die, the money passes directly to that person outside of your will or estate — they don't have to wait for probate, and creditors generally cannot touch it.

Most banks allow you to name a beneficiary on savings accounts, checking accounts, and money market accounts. Some banks let you name multiple beneficiaries and decide how the money splits between them. The process takes minutes and costs nothing. You fill out a form at your bank, name the person, provide their Social Security number or tax ID, and you're done.

Key Takeaways

A beneficiary on a bank account receives the money directly after you die, without waiting for probate or your will to be processed.
You can name a beneficiary on savings, checking, and money market accounts at most banks by filling out a straightforward form.
If you name multiple beneficiaries, you decide whether they split the money equally or in percentages you set.
The beneficiary has no access to the account while you are alive, even if they are named.
You can change or remove a beneficiary at any time during your lifetime.

How the beneficiary designation actually works

When you die, the bank does not automatically know. Your family or executor has to notify the bank and provide a death certificate. Once the bank confirms your death, they release the money to the person you named — no court involvement needed. This is why POD accounts are useful: they skip probate entirely for that specific account.

The beneficiary has zero access while you are alive. They cannot see the balance, withdraw money, or make deposits. The account is entirely yours to use. Only after your death does the money move to them. If you change your mind, you can remove the beneficiary or name someone else by going back to the bank and updating the form.

The money in a POD account is still considered part of your estate for tax purposes, so it may affect your federal estate taxes if your total estate is very large. But for most people, this is not a concern. The account itself avoids probate fees and delays.

What information you need to name a beneficiary

Your bank will ask for the beneficiary's full legal name, date of birth, and Social Security number or tax identification number. Some banks also ask for their address. Have this information ready before you go to the bank or call to set it up.

If you want to name a minor child, the bank will usually require you to name an adult custodian or trustee to manage the money until the child reaches the age of majority (usually 18 or 21, depending on your state). You cannot straightforward name a child and have the money sit there — someone has to be able to access it on their behalf.

Naming multiple beneficiaries and splitting the money

You can name more than one beneficiary on most accounts. When you do, you tell the bank how the money should be divided. The most common options are equal shares or percentages you specify. For example, you might say 50% to your spouse and 25% each to two adult children.

If you name multiple beneficiaries and do not specify how to split the money, most banks will divide it equally among them. But it is clearer to state the split yourself on the form. If one beneficiary dies before you do, the money that would have gone to them usually goes to the remaining beneficiaries, unless you specified otherwise — check your bank's rules on this.

The difference between POD accounts and joint accounts with survivorship

A POD account is different from a joint account with right of survivorship. On a joint account, both people own the money right now and can both access it. When one owner dies, the surviving owner automatically owns the whole account. On a POD account, only you own it while you are alive, and the beneficiary gets it only after you die.

Joint accounts are useful if you want someone to help manage your money during your lifetime — for example, a spouse or an adult child who pays your bills. POD accounts are better if you want to leave money to someone but do not want them to have access to it yet. Some people use both: a joint account for day-to-day expenses and a POD account for savings they want to pass on.

How to set up a beneficiary at your bank

Call your bank or visit a branch and ask to add a payable-on-death beneficiary to your account. They will give you a form — sometimes called a POD form, beneficiary designation form, or transfer-on-death form. Fill it out with the beneficiary's name, date of birth, and Social Security number. Sign it and return it to the bank.

Some banks let you do this online through your account settings, though most still require you to visit in person or mail a signed form. Ask your bank which method they accept. Once the form is processed, the beneficiary designation is in effect when ready. You do not have to wait or do anything else.

Keep a copy of the signed form for your records. If you ever need to change the beneficiary, you will fill out a new form — the new one replaces the old one. There is no fee for adding, changing, or removing a beneficiary.

What happens if you do not name a beneficiary

If you die without naming a beneficiary, the money in your account becomes part of your estate. It goes through probate, which means a court oversees how it is distributed according to your will or, if you have no will, according to your state's intestacy laws. This takes months and costs money in court fees and attorney fees.

Naming a beneficiary is one of the simplest ways to avoid this. It takes five minutes and costs nothing. Even if you have a will, a POD designation overrides the will for that specific account — the beneficiary you named gets the money, period.

Frequently Asked Questions

Can the beneficiary access my account while I'm alive?

No. The beneficiary has no access to the account, cannot see the balance, and cannot withdraw money while you are alive. The account is entirely yours. They only receive the money after you die and the bank is notified.

What if I name a beneficiary and then change my mind?

You can change or remove a beneficiary at any time. Go back to your bank, fill out a new beneficiary form with the new person's information or leave it blank to remove the designation, and sign it. The new form replaces the old one when ready.

Do I need a lawyer to name a beneficiary?

No. Naming a beneficiary on a bank account is a straightforward form you fill out at the bank. You do not need a lawyer, though you may want to talk to one if you are setting up a larger estate plan that includes a will or trust.

What if my beneficiary dies before I do?

That depends on your bank's rules. Usually, the money goes to any other beneficiaries you named, or back into your estate if there are no other beneficiaries. Check with your bank about their specific policy when you set up the account.

Does naming a beneficiary affect my taxes?

Not for income tax purposes — the beneficiary does not owe income tax on the money they receive. For federal estate tax, the account is still part of your taxable estate, but this only matters if your total estate is very large (over $13 million in 2023, though this amount changes yearly).

This guide is for general information only and is not medical, financial, legal, or other professional advice. For decisions specific to your situation, consult a qualified professional. See our Editorial Policy.