Best brokers for beneficiaries?

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destin
Posts: 51
Joined: Wed Dec 27, 2017 2:20 pm

Best brokers for beneficiaries?

Post by destin »

I've been thinking about the beneficiary transfer process and noticed how little I know about the entire process between each brokerage. Nobody reviews this either. I'm assuming having designated beneficiaries would make the process straightforward based on the marketing ("Life Services Department") but this is something I've never done.

For those who unfortunately had to deal with this situation, what was your experiences like when inheriting an account? Was it before the pandemic? Was it for a spouse or non-spouse? What kind of hassles did each broker give you? Could you have done everything online/phone or did they need to visit their physical location or get a special document stamp? From receiving the death certificate until the transfer or distribution of assets, how long did the whole process take?

And if you had the unfortunate situation to deal with multiple brokerages, which ones did you feel did the best and which ones did the worse?
ccieemeritus
Posts: 766
Joined: Thu Mar 06, 2014 9:43 pm

Re: Best brokers for beneficiaries?

Post by ccieemeritus »

In 2017 my Mom died. She had an IRA at TD Ameritrade. I helped the 5 beneficiaries (including 2 of my kids) with the paperwork.

Most brokerages/banks have an “estate” or “survivor” office which specializes in supporting beneficiaries after a death. In my experience they are always sympathetic, experienced, and helpful. It’s clear brokerages put some of their best people there. No outsourced call center!

Google search to find the number for that office. Schwab for example: https://www.schwab.com/life-events/losing-a-loved-one

The process is simple once someone notifies the broker with the death certificate. Any beneficiary can walk in with proof of identity and fill out forms to create an account and move over their share of assets. The process was completed before I was confirmed as my mom’s probate executor (for other assets).

I believe the process could have been completed remotely. Most of the work is new account forms. But we dropped off the death certificate and proved identity in person given we had a convenient office.
RetiredAL
Posts: 3736
Joined: Tue Jun 06, 2017 12:09 am
Location: SF Bay Area

Re: Best brokers for beneficiaries?

Post by RetiredAL »

destin wrote: Mon Jun 10, 2024 7:19 pm I've been thinking about the beneficiary transfer process and noticed how little I know about the entire process between each brokerage. Nobody reviews this either. I'm assuming having designated beneficiaries would make the process straightforward based on the marketing ("Life Services Department") but this is something I've never done.

For those who unfortunately had to deal with this situation, what was your experiences like when inheriting an account? Was it before the pandemic? Was it for a spouse or non-spouse? What kind of hassles did each broker give you? Could you have done everything online/phone or did they need to visit their physical location or get a special document stamp? From receiving the death certificate until the transfer or distribution of assets, how long did the whole process take?

And if you had the unfortunate situation to deal with multiple brokerages, which ones did you feel did the best and which ones did the worse?
I recently dealt with Trust Accounts at Schwab, Wells Fargo, and USAA (Victory).

Schwab was a pieces of cake.

Wells Fargo had a few timing wrinkles but it all worked out.

USAA-Victory would not re-title the accounts because the Lawyer's Generated EIN Title did not 100% agree letter by letter with the 35 year-old Trust Documents relating to Successor Trusts. No other institution had trouble with the Successor Trust naming. USAA-Victory did let me as Trustee to easily close the accounts and send the proceeds to the bank-account-of-record, so the result was those the accounts got closed a little earlier than originally planned.

Edit to add: There was also an IRA at Schwab.
Last edited by RetiredAL on Mon Jun 10, 2024 8:11 pm, edited 1 time in total.
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Wiggums
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Joined: Thu Jan 31, 2019 7:02 am

Re: Best brokers for beneficiaries?

Post by Wiggums »

Took care of this for my MIL for one account that did not have a beneficiary named. The broker takes instruction from the personal representative. The process takes time, but is NOT difficult because the broker will talk you through the steps.

Completed all the steps by submitting documentation electronically and opening new accounts online. The broker moved the funds to the new account.
Last edited by Wiggums on Mon Jun 10, 2024 8:16 pm, edited 1 time in total.
"I started with nothing and I still have most of it left."
Makefile
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Joined: Fri Apr 22, 2016 11:03 pm

Re: Best brokers for beneficiaries?

Post by Makefile »

Do most find that when there are multiple TOD beneficiaries, that the whole process is held up by the slowest beneficiary? Or do some brokers have an ability to split up the account as the account opening forms come in from each one?
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Wiggums
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Re: Best brokers for beneficiaries?

Post by Wiggums »

Makefile wrote: Mon Jun 10, 2024 8:15 pm Do most find that when there are multiple TOD beneficiaries, that the whole process is held up by the slowest beneficiary? Or do some brokers have an ability to split up the account as the account opening forms come in from each one?
Yes, it slows down the process. Some insurance companies won’t even process your request until all the paperwork is ready. It also makes more work for the personal representative to track all this.

In our Will, our personal representative can request reasonable compensation for doing this job.
"I started with nothing and I still have most of it left."
CloseEnough
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Joined: Sun Feb 14, 2021 7:34 am

Re: Best brokers for beneficiaries?

Post by CloseEnough »

Makefile wrote: Mon Jun 10, 2024 8:15 pm Do most find that when there are multiple TOD beneficiaries, that the whole process is held up by the slowest beneficiary? Or do some brokers have an ability to split up the account as the account opening forms come in from each one?
I have experience with multiple TOD beneficiaries on Fidelity accounts and there was no hold up at all. As each beneficiary came forward their portion of the account was transferred to an account they set up at Fidelity. That, despite the fact that one beneficiary was a lot slower than the others to trigger the process. I found Fidelity to be easy to deal with, for the most part, and very good at the administration of the transfer process.
stan1
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Joined: Mon Oct 08, 2007 4:35 pm

Re: Best brokers for beneficiaries?

Post by stan1 »

It is something that most of us only have to deal with a few times in our lives, fortunately, but the large brokerages have entire staffs of people who work these issues because they have hundreds or even thousands of deaths reported per day.

When in-laws passed in 2019 their local Merrill Lynch Wealth Management office actually had a nice lady whose job was to manually calculate cost basis and split holdings. It surprised me greatly that this was 1) done manually and 2) the job of the local office not the back office.

I'd expect Vanguard, Fidelity, or Schwab to be more efficient.
Alan S.
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Location: Prescott, AZ

Re: Best brokers for beneficiaries?

Post by Alan S. »

You are only asking about brokerages, but there are several other types of custodians for various accounts:

1) Mutual fund companies
2) Banks and CUs
3) Insurance companies
4) Qualified plan administrators

These custodians may not even operate the same depending on the type of account:
1) Taxable
2) Taxable with TOD
3) Joint tenancies
4) IRA
5) Qualified plan
6) NQ annuity
7) Estate inherited accounts
8) Trust inherited accounts

Procedures could vary with the same custodian from account type to account type.
rogue_economist
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Joined: Mon Apr 01, 2024 3:52 pm

Re: Best brokers for beneficiaries?

Post by rogue_economist »

Vanguard for whatever reason does not require an SSN, which can be helpful in certain situations.
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