Q: Are there any significant disadvantages to having a TOD (transfer on death) agreement for one's brokerage accounts?

A: Suggest that you review the information at: https://www.finra.org/investors/insights/plan-ahead-transfer-your-brokerage-account-assets-death#:~:text=With%20a%20TOD%2C%20you%20keep,changes%20or%20revoke%20the%20TOD.

A: Transfer on death designations can work well when everyone dies in the correct order. Unfortunately, that does not always happen. If a TOD beneficiary dies before the account holder passes, it can sometimes be unclear what happens next. If you have named a contingent beneficiary and that person has also predeceased you, that could result in a probate for that asset, the very thing you meant to avoid. So, it is important to keep TOD designations current, if you choose to go that route.

TOD beneficiary designations can result in a beneficiary inheriting funds outright that maybe should have been placed in a protective trust, such as a special needs trust or a spendthrift trust.

TOD beneficiary designations do nothing to solve the problem of account management during the account holder's incapacity.

The gold standard in estate planning is the revocable living trust (RLT), and sometimes an irrevocable trust as well. An RLT avoids probate and provides for account management during incapacity and can provide for a very sophisticated plan of distribution that solves for virtually every conceivable outcome up to and including a remote contingent beneficiary (usually a charity) in case every person you named predeceases you.

Also, if you change your mind about your plan of distribution, you only need to amend your trust. You do not need to go to every bank and fill out forms for every account to update all of those beneficiary designations.