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Criminal, Family and Probate Law

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Arkansas residents can use Totten trusts to avoid probate

On Behalf of | Jun 2, 2025 | Probate

If you have always provided for your spouse and family members during your lifetime, it makes sense that you want to do the same in your estate planning, so they are comfortable after you pass away.

Bypassing probate is always better for heirs and beneficiaries. A Totten trust offers an inexpensive way to do this.

Totten trusts are not conventional trusts

Trusts are an important estate planning tool, but not everyone needs a trust. Rather, Totten trusts are payable-on-death accounts wherein the funder simply opens a bank account and names the beneficiary to whom the funds go when the depositor dies.

How they got the name

The name arose from In re Totten, the case filed in New York in 1904 that established an individual can open bank accounts to be used as trusts for other people. Other states also adopted the ruling.

Other than the name, these trusts are just bank accounts controlled by the depositor. They can add and withdraw funds, change beneficiaries and close the accounts at will during their lifetimes. 

Need more complex estate planning options?

Totten trusts work because they are simple and don’t cost anything (except the deposits to fund the account). But they are not the answer to all estate planning needs. For one thing, they only address cash assets. More complex resources like real estate or collectibles can be handled using living trusts or sometimes even wills (although that means probate will usually be necessary).

The takeaway is there is no one-size-fits-all solution to estate planning. Instead, there is an array of options to explore before deciding on the estate plan that fits your circumstances best.