The ownership of a mutual fund account can allow for beneficiaries depending on how the account is registered. For example, mutual funds are frequently offered by retirement plans such as a 401(k) or an individual retirement account (IRA). You can also own a mutual fund account with a transfer-on-death (TOD) registration that allows for beneficiaries. College savings accounts, or 529 savings plans, also have beneficiaries.

Opening a Mutual Fund Retirement Account

At the time a retirement account is opened, such as when enrolling in an employer's 401(k) plan, an application form is completed. In addition to filling in a name, address and Social Security number, there is a space provided on the application to name primary and secondary beneficiaries. This is an important decision because, in the event of the owner's death, the beneficiary inherits the proceeds from this account.

Opening a Transfer-on-Death Account

A mutual fund account can also be opened as an individually owned account, and the owner can name one or more beneficiaries using a TOD registration. The owner maintains control over the account during his lifetime. Those named beneficiaries inherit the account upon the death of the owner. The transferring of assets from this type of TOD account avoids probate.

Opening a 529 Savings Plan

College 529 savings plans are owned by an account holder who selects a beneficiary. The 529 plan is a tax-advantaged method to save for college if the account proceeds are used for qualified education expenses. The owner controls the account and can invest in mutual funds.