Handling the Estate of a Love One

The death of a spouse/partner, parent, child or anyone you’re close to can be very difficult.  If your loved one has recently died, please accept my sympathies for your loss.  Or maybe you’re just getting organized before a death occurs.  In either case, I hope that this article will prove helpful to you.

Unfortunately, there are quite a few steps to go through when someone dies – especially if you are acting as the personal representative (also called the executor in many states.)  Here is a pretty good basic list to get you started.

Overview:

1. Avoid Major Decisions.  Many of us have our thinking clouded in the early stages of grief.  Therefore, it’s important to defer any major decisions unless they absolutely require immediate attention.
2. Get Help.  Contact your estate attorney or another lawyer that you use.  Contact your financial advisor.  (We previously wrote an article on the role of a financial advisor when a spouse dies that may be useful.)  Contact your CPA or tax preparer.  Your professional team can help with many of the steps that follow.  Their expenses are typically paid for by the estate.

Immediate Actions:

1. Pet Care.  If the deceased lived alone and had pets, it’s essential to contact someone to be sure they’re taken care of right away.
2. Notify Close Family and Friends.  Inform immediate family members, close friends and any other relevant individuals about the death.
3. Contact Medical Professionals.  If the death occurs at home, contact emergency services or the attending physician to confirm the death and obtain a death certificate.
4. Contact Funeral Home.  Arrange for the transportation of the body and make initial funeral or cremation arrangements.
5. Secure Important Documents.  Locate the will (and letters of instruction if they exist), life insurance policies, birth and marriage certificates, Social Security card and any other important documents.
6. Don’t Do This Immediately.  Keep your loved one’s phone active to receive important calls.  Also, don’t cancel their primary credit card immediately until you can handle automatic payments and the like.

Legal and Financial Steps:

1. Obtain Death Certificates.  Request multiple copies (10-12 are often recommended) of the death certificate from the appropriate authorities. You’ll need these for various legal and financial purposes.
2. Notify Employer and Financial Institutions.  Inform your loved one’s employer or former employer’s benefits department since in many cases, you’ll still be covered by your spouse’s health insurance if his/her company offered such coverage.   Contact banks, investment firms, and other financial institutions of the death.  Also, note that accounts and safe deposit boxes may be temporarily frozen, so be prepared for that.
3. Contact Insurance Companies.  Notify life insurance, health insurance, and other relevant insurance providers of the death and initiate the claims process.
4. Review and Execute the Will.  If there’s a will, contact the personal representative/executor if it’s someone other than you.  If it is you, review it carefully and consult with an attorney to begin the probate process if necessary.  (We previously wrote an article on probate that you may wish to consult.)
5. Credit Agencies.  Contact Experian, Equifax, and TransUnion and inform them of the death.  Put a fraud alert on the deceased’s Social Security number.  Also, request final copies of their credit reports.
6. Handle Accounts and Subscriptions.  Close or transfer your loved one’s accounts, including bank accounts, credit cards, utilities, subscriptions, and memberships.

Practical Matters:

1. Make Funeral Arrangements.  Plan the funeral, memorial service or celebration of life according to your loved one’s wishes or religious/cultural traditions.  You’ll need to write an obituary unless the deceased wrote their own.  If the deceased is a veteran, he/she may have burial benefits, so check with Veterans Affairs.
2. Manage Property and Assets.  Secure your loved one’s property and assets, including their home, vehicles, and personal belongings.
3. Address Debts and Expenses.  Pay any outstanding debts, including medical bills, credit card debts, and funeral expenses — from the estate if possible.
4. Update Legal Documents.  Review and update legal documents such as deeds, titles, and beneficiary designations as necessary.
5. Contact Social Security.  If the deceased was your spouse, it’s likely that Social Security benefits will change.  Often, your total benefits will decrease, but the amount that you personally receive will increase.
6. Taxes.  There are two kinds of taxes to take care of.  First, there are personal income taxes that need to be paid for the deceased for the year that they died.  Second, there may be estate taxes depending on state in which the deceased resided and the amount of assets in the estate.  Colorado does not have estate taxes.

Emotional and Personal Support:

1. Seek Emotional Support. Lean on friends, family, support groups or a therapist for emotional support and guidance through the grieving process.
2. Take Care of Yourself.  Remember to prioritize your own well-being during this difficult time. Get enough rest, eat properly and engage in activities that bring you comfort.
3. Consider Practical Help.  Accept offers of practical assistance from friends and family members, such as help with meals, childcare or household chores.

Dealing with the death of a loved one can be overwhelming, so take things one step at a time and don’t hesitate to ask for help when needed. This article can serve as a guide to help you navigate the practical and emotional challenges that arise during this difficult time.  There are many other things to consider such as stopping prescription deliveries, returning any medical equipment and so forth.  We would be happy to meet with you to review your situation through a no-charge, no-obligation initial meeting.  To set up a meeting, please visit our website or give us a call at 970.419.8212.

This article is for informational purposes only. This website does not provide tax or investment advice, nor is it an offer or solicitation of any kind to buy or sell any investment products.  Please consult your tax or investment advisor for specific advice.