What Is a Transfer on Death (TOD)? A Simple Guide for Investors
Planning for the future is an important part of managing your investments. One tool that can help simplify the transfer of assets is a Transfer on Death (TOD) designation.
A TOD allows eligible investment account assets to pass directly to designated beneficiaries after the account owner’s death, helping avoid the probate process and making the transition more efficient for loved ones.
Below, we explain how a TOD works, how to set one up, and what investors should know.
What is a Transfer on Death (TOD)?
A Transfer on Death (TOD) is a beneficiary designation that allows you to name one or more individuals who will receive the assets in your eligible investment account when you pass away.
Once the TOD designation is properly completed, submitted, and accepted, the assets in the account can transfer directly to the named beneficiaries without going through probate.
It’s important to note that a valid TOD designation generally overrides instructions contained in a will or trust for that specific account.
How does a TOD Work?
With a TOD designation in place:
- You remain the full owner of the account during your lifetime.
- Beneficiaries do not have access to or ownership of the account while you are alive.
- After your passing, eligible assets may transfer directly to the designated beneficiaries once required documentation is provided and reviewed.
This process is designed to help simplify estate administration for investment accounts.
How to set up or update a TOD beneficiary
To establish or update a TOD beneficiary on your Inter Securities account, you must complete and sign the Transfer on Death (TOD) Beneficiary Designation Form.
The form can be requested by emailing:
help@inter.co
Important information:
- Only the account owner(s) may complete and sign the form.
- Power of Attorney (POA) is not permitted for TOD designation requests.
- Completed forms must be submitted by email to help@inter.co.
- Changes are not effective until the form is received and formally accepted.
Submitting a new form automatically replaces any previous TOD beneficiary designations on file.
What account types are eligible?
At Inter Securities, all accounts are currently established as Individual accounts that are custodied at DriveWealth. These accounts are eligible for a TOD designation on the account.
What happens to the account after the owner passes away?
After the account owner’s passing, the beneficiary is responsible for initiating the transfer process and providing the required documentation.
Before assets can be transferred:
- Any outstanding margin balances or debts must be resolved.
- Certain securities may need to be liquidated if they cannot be evenly distributed.
- Assets may be temporarily restricted until beneficiary entitlement is confirmed.
If no valid beneficiary can be identified, or if required documentation is incomplete, the assets may instead become part of the estate.
Why reviewing your beneficiaries matters
Major life events — such as marriage, divorce, births, or deaths in the family — can affect estate planning decisions.
Reviewing your TOD designations regularly helps ensure your account information remains aligned with your wishes.
Final thoughts
A Transfer on Death (TOD) designation can be an effective estate planning tool for investors who want to simplify how eligible investment account assets are transferred to beneficiaries.
Understanding how TOD designations work, when to update them, and what happens after an account owner passes away can help investors make more informed financial planning decisions.
This content is for informational purposes only and does not constitute legal, tax, or estate planning advice.
