One of the hardest parts of losing a loved one is dealing with the financial aftermath. While your family and friends are aware of the passing, the rest of the financial institutions are not and they will keep sending the bills. Gym memberships, subscription wine club memberships, student loans, credit cards, Netflix subscription, utility bills, etc. – all of these have to be addressed.
- Make sure you have authority to act and get a document to prove it. Get at least 10 copies of the death certificate. Some financial institutions accept copies, other require a certified original. Usually you order death certificate from a funeral home, and only the person who has authority to order them can get them. The person who has authority is either the person who paid for the funeral or the closest relative.There are some exceptions to this rule, but a distant relative is not simply permitted to order a death certificate.
- If you are named as an Executor of a Will, make sure to start the process of the probate. If there is no Will, you have to start the process of administration. Both of these are court processes where the Will is authenticated in court, the required family members are found and informed of the documents, the assets are gathered, the debts are paid, and the net is distributed. Depending on the complexity of the family situation, the full court process can take over a year (and sometimes considerably longer). However, even while this court process is pending, you can ask the court for a temporary limited authorization to handle the some of the bills.
- Make a list of accounts that you have to address. There are bank accounts, credit cards, magazine subscriptions, etc. If you have access to credit card statements, go through these for at least several months in the past, as some subscriptions are annual. If you do not have access to statements, because everything is now electronic, close the credit cards as soon as possible. That will automatically stop the recurring billing from the majority of financial institutions and force them to send a final bill in the mail for any outstanding balance.
- Get on the phone to close the accounts. Most large financial institutions are familiar with dealing with the accounts of the deceased so they will know what to do and what information to ask you. Again, if you can – get access to as many past statements as possible before you close the bank accounts, because it is very difficult to get the statements once the account has been cancelled.
- Contact the credit bureaus. Even though they should receive information about a person’s death automatically, there are frequently lapses of communication. Identity theft does not stop with someone’s death.
- Don’t spend your own money! Remember, unless your name is on the account, you are personally not responsible for the decedent’s debts. Only the decedent’s estate is responsible for the debt. If you are concerned about insufficiency of funds, you should definitely speak with an attorney, because some creditors have priority over others.
It is very important to administer the Estate properly. Contact Katya Sverdlov at email@example.com or 212-709-8112 if you want to discuss your planning further.