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10 Steps to Take When a Loved One Passes Away

10 Steps to Take When a Loved One Passes Away

| August 01, 2023

Losing a loved one is never easy. On top of the emotional distress, you maybe suddenly must deal with financial issues you’ve never encountered. This blog article can help you walk through some of the most important steps to take on behalf of your loved one’s finances.

  1. Order multiple copies of the death certificate.

    Financial institutions and insurance companies (and sometimes utility companies) will require certified death certifications before they release funds or change account ownership. The funeral home, mortuary, or medical examiner’s office can provide them for you. Depending on your state, the cost could range from $10 to $25 per death certificate.

  2. File the will with the appropriate probate court, establish an estate, if needed.

    Contact your loved one’s estate-planning attorney to determine if you need to file the original will with the probate court and/or estate. The attorney should have copies of your loved one’s most recent estate-planning documents and can assist you with the probate process.

    In addition, you should contact the local Probate Court/Register of wills. They will be VERY HELPFUL in showing you what you need to do in that county or state to settle the “estate.” Most counties and states give you a plethora of knowledge and forms on their websites. Be sure to log on to their website and then reach out to them with a phone call.

    Also, you may need to contact the financial institution that holds the mortgage for your loved one’s real estate to ensure the mortgage and homeowner’s insurance are paid while the estate is being settled.

  3. Notify your loved one’s employer(s).

    Be sure to collect any salary, vacation or sick pay owed. You also may want to investigate continuing health insurance coverage and potential survivors’ benefits for a spouse or children. If the death was work-related, you may be able to file a claim for Workers’ Compensation benefits and/or accidental death claims. You also should contact past employers about pension plans.

  4. Contact your loved one’s financial advisor.

    A financial advisor can help determine the investments your loved one owed and help access the value of those assets on the date of death. He or she also can help retitle assets in the name of a beneficiary or heir. They may be your best source of help during this time (along with the probate court).

  5. Report the death to the Social Security Administration.

    If your loved one received benefits, contact your local Social Security Administration office to find out whether any payments must be returned. Additionally, a surviving spouse may be eligible for a lump-sum death benefit and/or survivor’s benefit (especially for minor children). To learn more, contact your Social Security Administration office, or call 800-772-1213.

  6. File any insurance claims.

    Contact insurance companies where your loved one owned policies and ask about their claim processes. You also should consult your legal or tax advisor to determine whether funds may be needed to pay financial expenses or taxes. In the case of annuities, the beneficiary(ies) should consult with a legal and/or tax advisor to determine which payout option is appropriate.

  7. Be careful whom you contact before having the proper paperwork in place.

    I know most people will want to reach out to the deceased’s bank account right away. However, this may cause a lot of short-term issues. Whether or not the account is jointly owned or owned individually (by or with the deceased), most banks will close the account until proper paperwork can be presented and until you re-title the existing account.

    If the deceased had automatic deposits and/or automatic monthly payments (to mortgage, utilities, etc.) these can be shut off and cause short term issues that would then need to be addressed somehow. It is best to go into said bank with the death certificate and probate paperwork (letters of administration, etc.) in hand to settle and retitle immediately then to call in advance. Again, as stated in #2 check mortgage payments, utility payments, loan payments, etc.

  8. Reduce the risk of identity theft.

    Notify your loved one’s financial institutions to retitle or distribute the accounts and cancel any online banking services. Cancel your loved one’s passport, driver’s license, and any credit cards in his or her sole name.

    Review credit card statements transactions monthly to ensure no unauthorized transactions have occurred and fees are reimbursed when appropriate. You also should report your loved one’s death to all three credit reporting agencies: Experian, Equifax and TransUnion. They can flag the account as “deceased” to create a permanent credit freeze.

  9. File a federal and or estate tax return (possibly).

    You should consult with your legal or tax advisor to determine whether your loved one’s estate is required to file a federal estate tax return. State laws vary, but you may need to file state estate tax and/or inheritance tax returns within nine months of the death. In addition, federal and state income taxes are due for the year of death on the normal filing date. If you need assistance, please consult a qualified tax professional.

  10. Close your loved one’s social media and online accounts.

    Social media sites have different policies on closing the account of a loved one. In some cases, you may be able to turn your loved one’s page into a memorial. Online platforms enforce their own rules on who can or can’t access a deceased person’s accounts. If you have questions about this, you may want to contact the customer service areas platforms such as Facebook, Instagram and Twitter to learn their policies.

    Also consider other types of online accounts, such as financial (PayPal, Venmo, bill-paying), virtual property (air miles, “points” for hotel bookings), business (eBay, Amazon, Etsy), email (Gmail, Outlook, Yahoo), online storage (Google Drive, iCloud, Dropbox) and subscriptions (Netflix, Amazon Prime/Kindle, Apple, etc.).

Hopefully, you do not need this information today. However, if or when you do, I am hopeful it helps make a daunting task easier for you. If you have any questions, you are always welcome to reach out to me or anyone on my team at Phronesis Wealth Management to discuss the specifics of your situation.

Securities offered through LPL Financial, member FINRA/SIPC. Investment advice offered through Phronesis Wealth Management, a registered investment advisor and separate entity from LPL Financial.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.