A "Totten trust" is a bank account which is automatically transferred to a named beneficiary when the holder of the account dies ("payable on death"). Its name comes from a 1904 New York Court of Appeals case, Matter of Totten, which first established that such instructions would be legally binding on the bank and the account holder's estate. Nowadays, every state in the US allows Totten trusts.

In essence, such a trust is an alternative to a last will and testament for people who do not have enough property to make one worthwhile (or, for that matter, to pay a lawyer to write one). It is often thought of as a "poor man's will."

The trust does not really take effect until the account holder dies. While the account holder is alive, they may continue to use the money as they see fit. They may even change the beneficiary, cancel the "payable on death" instruction, or close out the account completely.

Once the account holder dies, the beneficiary automatically receives the contents of the account. There is one major exception to this rule: Because a person cannot freely give away their property while they are insolvent (see the Uniform Fraudulent Transfers Act), the estate of the account holder may dip into the Totten trust to satisfy the expenses of administering the estate and burying the account holder if his other property is insufficient to cover these expenses.

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