Assets like 401(k) plans, life insurance, and IRAs often bypass probate and get distributed directly to named beneficiaries. On the other hand brokerage accounts usually get distributed in a decedents will and must pass through probate. One tool a person might use to bypass probate and distribute a brokerage account directly to named beneficiaries is a transfer on death (TOD) registry. A TOD can give a person more control and allow them to directly designate the beneficiaries, and they can also change the listed beneficiaries at any time. This investment tool might not be for everyone, there may be some circumstances when it might be better to draft a will. According to this article Louisiana and Texas both currently do not offer this investment option.
See Kimberly Lankford, How Your Brokerage Account Can Bypass Probate, Kiplinger, July 10, 2015.
Special thanks to Jim Hillhouse for bringing this article to my attention.
