Question of the Week

Question: Can a payable-on-death beneficiary decline to accept the designation? If so, where do the funds go?

Answer: Yes. A payable-on-death beneficiary does not have to accept the designation and may refuse based on their own personal situation. In that case, the funds would be split among the remaining beneficiaries or in the absence of any other beneficiaries to the estate of the deceased member.

For the credit union’s purposes, it should document in writing that the beneficiary has refused, so that credit union would not be liable later for not paying out the funds.