Individual Account

An individual account is an account that is owned by one person. That person makes the determination as to what securities are purchased and sold. In addition, that person receives all of the distributions from the account.

Joint Account

A joint account is an account that is owned by two or more adults. Each party to the account may enter orders and request distributions. The registered representative does not need to confirm instructions with both parties.  Joint accounts require the owners to sign a joint account agreement prior to the opening of the account. All parties must endorse all securities and all parties must be alive. Checks drawn from the account must be made out in the names of all of the parties.

Joint Tenants with Rights of Survivorship (JTWROS)

In a joint account with rights of survivorship, all the assets are transferred into the name of the surviving party in the event of one tenant’s death. The surviving party becomes the sole owner of the assets in the account.  Both parties on the account have an equal and undivided interest in the assets in the account.

Joint Tenants in Common (JTIC)

In a joint account that is established as tenants in common, the assets of the tenant who has died become the property of the decedent’s estate. They do not become the property of the surviving tenant. An account registered as joint tenants in common allows the assets in the account to be divided unequally; one party on the account could own 60% of the account’s assets.

Note: Any securities registered in the names of two or more parties must be signed by all parities and all parties must be alive to be considered good delivery.

Transfer on Death (TOD)

An account that has been registered as a transfer on death (TOD) account allows the account owner to stipulate to whom the account is to go to in the event of their death. The party who will become the owner of the account, in the event of the account holder’s death, is known as the beneficiary. The beneficiary may only enter orders for the account if they have power of attorney for the account. Unlike an account that is registered as JTWROS, the assets in the account will not be at risk should the beneficiary become the subject of a lawsuit, such as in a divorce proceeding. In the event of the accountholder’s death the account will pass to the beneficiary in a non testamentary transfer that is the account ownership will transfer to the beneficiary without going through the probate process. 

 

ACCOUNTS FOR EMPLOYEES OF OTHER BROKER DEALERS

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