The death of a loved one is a difficult time to endure as your head and heart are never prepared for the loss. In addition to the grief of missing a deceased loved one is being responsible for the financial arrangements as well as funeral provisions for the deceased. Although talking to a loved one about this subject may seem morbid, planning ahead can minimize family strain as you prepare to settle the numerous matters than need to be sorted. Pick a day to sit down with your loved one and figure out what they want and how they want it structured. Be open with them when you are discussing the matter as there are a number of things to discuss financially.
1. Be sure financial data is kept in one place
A financial fact sheet is an excellent way to keep all the necessary information in one place. Information that should not be omitted are all bank account information, mortgage info, pension information, service providers etc.
All essential information should be compacted into one file and kept in a previously designated safe place ready for someone else to take over. This is the best way to keep things as simple as possible for the person who will be making arrangements on the deceased’s behalf.
2. Make sure a will is drawn up
Making a will could be considered one of the most important things to have even if you are in good health. Having an up-to-date will keeps your loved ones from handling a financial nightmare. A will can clear up:
Where your assets will go as well as whom will take care of your estate. Once you have assets it is crucial to include them on your will. Property taxes, shares and money need to be delegated.
Any family conflict can be sidestepped when a will defines the delegation of your estate, assets and financials. In essence, a will is a guide for your kin.
If you aren’t married or in a civil union your partner will not automatically inherit. A will ensures your partner/loved ones are provided for.
If you have any dependents – children under 18 or anyone else who may depend on you – it is all the more reason to draw up a will. Although it is not an easy topic, be sure to arrange for them to be in proper care in the event of your death. Ensuring their safety is your goal.
Be sure the person you designate as caretaker of your children after you pass is prepared and understands that they cannot sway from the commitment once it is made.
It is wise to name the designated caretaker in your will as legal guardians. If they ever became unfit to care for the children, a court would appoint a suitable guardian.
4. Funeral arrangements
Has the funeral expenses been prepaid? If not, the first step is to open up a checking account for the estate to be used for this purpose. A tax ID number for the estate is generally required to open this account. Death is not low-cost therefore you will be faced with many expenses that will need to be paid right away.
5. Death Certificates
It is important to procure death certificates for the deceased. It is a good idea to ask for numerous original death certificates as you will need one for every account you will open or close related to the estate. For example, a death certificate is required to forward the deceased’s mail from the post office.
6. Closing all checking accounts and credit cards
It is imperative to close all necessary bank accounts as well as any credit cards that the deceased may have. Be sure that there are no automatic withdrawals that will be debited from their account that need to be ceased. The sooner the account is closed, the more money will remain in the estate. As there are withdrawals there may be automatic deposits as well that need to be stopped.
Social security: In the case of deposits from Social Security, if the checks continued to be deposited and cashed you are liable for repayment with penalties as well as interest.
7. Who is responsible for the deceased’s debts?
Death does not automatically mean that a person’s debts are forgotten, however, if the money was borrowed together, then the responsibility of repayment is passed on to the spouse until the payments are passed onto someone else. For example the sale of the deceased’s car, home, etc…
8. Death benefits to look into
Although most pensions end when a person dies, some may have a one-time death benefit. Social Security generally offers regular survivors benefits for the surviving spouse as well as a
two hundred and fifty five dollar lump-sum survivor’s benefit accorded to helping with some of the funeral expenses.
This is commonly assumed to the remaining spouse or beneficiary.
For the deceased who have served in the military, there are Veteran’s death benefits in the
amount ranging $7000 to $1000.