By Andrew Zashin*

This article originally appeared as a column for the Cleveland Jewish News.

Clients come in all the time with questions about how title affects ownership and access to bank accounts. Maybe an account is jointly held among spouses. Maybe a spouse is named on an account with a parent. Or, perhaps someone is on an account with a child. Maybe it’s the child’s account, but since that child is a minor, a custodian has been named. In all of those cases, access to the funds will be governed by the type of account held, as well as who holds the “title” to it.

You are probably familiar with the idea of an account with an individual account holder or, perhaps, a joint account such as a checking or savings account. When the account is held in the name of an individual, that individual is the only person with access. Period.

In the event the account holder dies, the account becomes part of the estate and would be accessible by the estate administrator to pay off obligations of the estate and ultimately to divide among heirs. In a divorce situation, the account might be divided as marital property, but the non-named spouse would not be able to go to the bank to immediately access the funds. If the account is a joint one, the joint owners have full and equal access.

A POD, or payable-on-death account, is another option, and a quick and easy way to leave money from an account to a beneficiary. The creation of a POD account essentially forms a very basic revocable trust. While the primary account holder lives, he or she is the only one who can access the account.

However, upon his or her death, the beneficiary need only bring proof of identity and the primary holder’s death certificate. Benefits of a POD account include that it’s free and easy to create. If you have enough funds on deposit to make FDIC insurance limits a concern, you can double your available coverage by separating out some funds into a POD account, though these accounts cannot be used to hide money from creditors or from a spouse in a divorce case. If you die and other assets in your estate are insufficient to cover your debts, these funds will be tapped.

If the intent is to gift money to benefit a child, an UTMA, or Uniform Transfers to Minors Act, or custodial account, might be a good option. The UTMA is model statutory language that has been adopted in some form by most states, and provides an inexpensive and uncomplicated way to gift money to minors. Ohio’s version of the law is called the Ohio Transfers to Minors Act.

These accounts are sometimes used for purposes of college savings or to make sure that a child has a bit of a nest egg as he or she embarks on his or her journey into adulthood. This type of account will have a custodian who is responsible for maintaining the funds on behalf of the minor child. The funds can generally be spent for the child’s benefit and would get turned over to the child once he or she turns 21. The gift is irrevocable. Ultimately, it will not likely be a successful tool to hide money from a spouse in a divorce case. Depending on the facts of its establishment, though, it would probably be maintained intact in a divorce, as the child’s property. These custodial accounts can be a useful part of an estate plan.

Whether you are looking to open an account or access funds in an account, the identity of the person, or people, who can access the money in that account, and under what terms, is governed by the type and title of the account.

*Andrew Zashin writes about law for the Cleveland Jewish News. He is a co-managing partner with Zashin & Rich, with offices in Cleveland and Columbus.