Required

Tips on Transferring Your Parents’ Brokerage Accounts After They Die, Elder Law Attorney, Woodstock, GA


Only two months after launching a helpline for seniors, FINRA has received a number of calls from stressed family members with questions about the transfer of brokerage account assets upon death, so it has released an extensive investor alert dealing with the issue. Since the Financial Industry Regulatory Authority introduced the Securities Helpline for Seniors on April 20, FINRA has received more than 600 phone calls on a variety of themes, according to spokeswoman Michelle Ong. But many of those calls came from adult children of deceased parents who were trying to track down their parents’ broker-dealer account assets, Ong added. As a result, she said, FINRA on June 17 released an investor alert, “Plan for Transition: What You Should Know About the Transfer of Brokerage Account Assets on Death.”

“It’s important to get the word out about this helpline because it’s such a valuable resource,” Ong said in an article by ThinkAdvisor, “4 Steps to Transfer Deceased Parents’ Brokerage Assets: FINRA.”

Beneficiaries should talk to the deceased’s financial advisor if available. The typical procedure for brokerages is to attempt to put beneficiaries in touch with the financial advisor right away. Advisors will be familiar with the parents’ investments and portfolio.

The article also points out that even though there are many seniors who share their estate planning strategies with their children, they may forget about the transfer of securities that are in a non-retirement brokerage account. Family members and other beneficiaries need to be prepared. These four tasks are recommended:

1. Find All of the Right Documents. Brokerages will need a death certificate, the court’s letter of appointment naming the executor, a “stock power” of attorney, a state tax inheritance waiver, an affidavit of domicile, as well as a trustee certification for accounts that are held in trust.

2. Call the Broker ASAP. When an account holder (the parent) dies, you need to contact the brokerage right away. Watch for account statements—you may not even be aware that an account exists!

3. Know How The Holdings Work. It’s best to have a candid conversation before a death to know the account holders’ assets, review account statements, and trade confirmations. The ownership structure is also something to think about, as asset transfers are impacted based on whether an account is for an individual owner or joint tenants.

4. Be Ready To Open a New Account. After a death, a new account is typically opened for the beneficiary or estate. Any transactions or transfers within the account can’t be completed until everything is legal, and the new account gets set up. It’s also the perfect time to see if the current firm and broker are a good fit.

Depending on the size of the brokerage accounts and its value, state law may provide for a Small Estate Affidavit to transfer the account without opening a probate.

The article urges beneficiaries to explore if there’s a transfer on death plan (TOD) available through the brokerage. If you create a TOD arrangement for your account, then you keep control of the brokerage account assets during your lifetime, and when you pass away, the ownership goes to the named beneficiaries without probate.

Be sure to discuss your options regarding brokerage accounts with your estate planning attorney.

Reference: ThinkAdvisor (June 26, 2015) “4 Steps to Transfer Deceased Parents’ Brokerage Assets: FINRA”

Hear From Our Clients
tes-prev
tes-next

I heard Cindy’s presentation at a Senior Luncheon at my church, and was very impressed. She helped my daughter and me understand many aspects of elder law. Josh has also been very helpful in my planning to enter an independent living situation . I have told many friends about them.

- Charlotte

The very best elder law attorney and staff anyone could ever ask for! I have referred a number of clients to Cindy and she never disappoints. She is kind, caring, and extremely thorough in making sure everything is completed as it should be. I highly recommend Cindy for anyone needing lawyer services; she truly goes above and beyond for every client she helps and has had a huge impact in so many peoples’ lives. Thank you, Cindy and staff, for everything that you do- I’m so glad to know you!

- Kerri

Cindy and the Nelson Elder Care Law team are trustworthy and helpful. They are the experts in elder care law. At Leaf Cremation, we entrust our families to the care of the Nelson team when their services are needed.

- Pierce

Josh Nelson, and his staff, have been amazingly helpful to our family. The ins and outs of nursing homes, the rules and regulations that govern Medicare and Medicaid are daunting and the folks at Nelson Elder Care Law have been informative, responsive, and above all, empathetic. I cannot emphasize enough how their service has taken a weight off of our shoulders especially during a world pandemic that has targeted nursing homes across our country. I highly recommend retaining Josh and his firm!

- Marcia

I had a simple legal question to them that I needed answered and they very helpful in giving me the information I needed. I highly recommend them and will reach out to them if I need more advice or assistance. Thank you for taking your time to just answer a couple of questions I had!

- Ben