finances after the death of a loved one
Sooner or later, our loved ones
are going to die.
When it happens, family members are left to sort through
a host of financial issues that start with funeral arrangements
and usually end with passing along or disposing of a lifetime of
Here are some of the details that need to be addressed
and how to handle them.
The first important step is to determine who's responsible
for these matters. It makes a difference because financial institutions
will only recognize authorized individuals.
Key positions include the executor of an estate, a
beneficiary of an insurance policy or retirement fund, the holder
of a power of attorney, a trustee, a joint owner of a bank account,
or a co-signer on a loan or safe-deposit box. You can have as many
copies of a death certificate as you want, but if your name and
signature isn't on the safe-deposit box account, you're not getting
into that box without a court order.
Speaking of death certificates, you will need lots
of them, and you need them quickly. Most companies will need to
have one to close out an account; insurance companies will require
it to process a claim. Call the coroner's office in the community
where the person passed away. If they don't handle it there, they
can tell you who does.
"Every time you change the name on an investment,
car, anything, you need a certified copy of the death certificate,"
says Connie Brezik, a certified public accountant and personal financial
specialist in Scottsdale, Ariz.
If you're the executor of the person's estate, it's
your job to pay any outstanding debts and disperse any remaining
funds or property to the beneficiaries listed in the will.
Depending on the state, you may need to post a notice
in the local paper where the person died, giving people a certain
amount of time to make claims against the estate, says Dave Evans,
vice president of retirement and financial planning with the Independent
Insurance Agents and Brokers of America. That keeps people from
showing up months later to demand payment of a bill.
Getting a life insurance claim paid should be a fairly
straightforward matter, Evans says. As a contract, it's not part
of the person's estate and doesn't go through probate. Once it's
submitted to the insurance company, it's usually paid within about
10 days and often covers immediate expenses, such as funeral arrangements
and the payment of any pressing bills, such as a house payment.
In addition to an individual life insurance policy,
if the person was still employed, life insurance may have been a
company benefit. Depending on the circumstances surrounding the
person's death, such as a car accident, an investigation may be
done to determine the cause of death because it could trigger additional
benefits. If a person died while traveling and had purchased travel
insurance, there may be even more insurance benefits.
If the person who died was still employed, Evans says
it's important to get a copy of the company manual and meet with
the human resources manager.