Nine Things To Do When a Spouse or Parent Passes Away
As we age, we are inevitably confronted with the loss of a loved one. Sometimes we have time to prepare, other times it is sudden. If we are fortunate enough to have some time to prepare mentally and emotionally, the time of action of coordinating these items can be much more controlled and organized.
If the death is sudden and we are dealing with it unexpectedly, it will be harder as the traumatic and emotional effects of our loved one’s passing are nevertheless fresh and we need time to allow ourselves to grieve. Aside from the immediate needs for the funeral arrangements, final medical bills, and notification of family and friends, the rest of these items can be handled over the coming weeks or already months if you are not ready or willing to address them closest after your loss.
The following 9 items should be addressed as soon as you are able to grieve and get comfortable taking on the challenge.
Item 1 – Get 5-10 additional copies of Certified Death Certificate.
For most survivors, you will need the ability to prove the death of your spouse or parent in order to move or change the ownership on assets, close accounts or modify existing assistance programs. Most of the companies and organizations that manager these items will require a certified copy of the death certificate as proof of death. Some may be willing to use a photocopy if you ask. They may be required to visually inspect the certificate before they accept a photo copy, just to ensure that it is an original and is certified.
Unfortunately, there are individuals out there who attempt to collect death benefits by using falsified and illegal death certificates. This has become more shared and many institutions will not accept copies because of this. But, especially if you are meeting with the institution in person, bring an original, certified copy and ask if they can make and accept a photocopy.
Each of these original, certified death certificates will cost between $5 and $25 if you get them at the time of the funeral. If you wait until weeks, months or years later, they could cost $50 to $200 depending on where you have to get them from.
calculate your needs for the bank, brokerage, IRA, 401k, life insurance, annuity and other accounts that you have. Then add about 5 more to that number for various others that may require it. Plus always save at the minimum one original for your future records and your family in case they need it later.
Item 2 – Assemble Your Trust Team.
Your Trust Team. Who is on your Trust Team? For most people, this should start with family members. Parents, children or siblings should always be considered first. As you age, it may already include some grandchildren who you have learned are worthy of your trust. This first part is those individuals that you know you can trust because they proportion your grief and are always looking out for your best interest.
Many of the decisions that you will need to make over the coming months may include looking out for your best interest and your financial, emotional and physical well-being. While the ultimate decision is always yours, you need the advice, input, insights and help of your trusted loved ones to help shape the best decisions for your present and future needs.
After you decide on a few trusted family members, you should then add some of the following outside members to your team. I suggest that if you have a financial and estate advisor, bring them in first to review your situation and make suggestions on what can be done first without the need for an attorney. Most good financial and estate advisors will be able to help you manager all the filings and forms needed to make death claims, assistance changes and updates with the need for attorney fees at this point. If you already have an existing relationship with this financial advisor, there may be little to no costs involved with these sets.
If you were to bring in an attorney first, many of these basic filings would be charged to your account at rates that could amount to 5 percent of the value of the assets, transfers or distributions. These costs could be saved by using a financial advisor to guide you by them.
You will also want to include your income tax preparer at some point to make sure that you get everything properly arranged with the IRS before the end of the year that the death occurred. If you don’t, there may be penalties that will be incurred.
Having a lawyer involved is something that you may need to do. But I would read the rest of these items and then make sure you have the checklist of items that you want the attorney to manager. If done correctly, much of the estate will already be administered and distributed before you visit with the attorney.
Item 3 – Contact Employers and Social Security
You will need to contact Social Security to notify them of the death. They will then begin processing the information and stop any monthly payments if there were any. Don’t worry, this is normal. A surviving spouse will receive the higher of the two social security amounts upon the death of one spouse. As an example. If Spouse A was receiving $1,000 monthly and Spouse B was receiving $750 monthly, if spouse A passes away, Spouse B will then receive the higher of the two amounts, $1,000 each month from then on.
Contact all past and present employers of the deceased. Ask if there were any death benefits as part of their employment. Also, ask if there were any death benefits as part of their retirement plan. Ask if there are any modifications needed to any monthly pensions that are being received. Finally, ask if there are any modifications needed for their health insurance if it was being provided by the company. Based on these answers, you will know if there is anything additional to take care of.
Item 4 – File Life Insurance Claims
Many individuals have multiple life insurance policies, possibly from several different companies over the years. If you find the policies or receive any bill or statements in the mail, inquire about the death benefits and options that you have obtainable. Provided that you were the beneficiary, there should only be a few forms to fill out and submit before you can receive your life insurance death proceeds. You may need to file a death claim for each different policy that you have in order to satisfy all policy claims.
Item 5 – Contact edges, Brokerage, and Credit Unions
Your local bank, brokerage, and credit union will need to be notified of the death. If your accounts were owned jointly with your spouse or parent, then you will just need to change the names on the account to remove the deceased individual. If they were only in the name of the deceased, then you will need to manager them differently. Ask the institution what their rules and procedures are as they pertain to these accounts and file the appropriate paperwork to manager the transactions.
Item 6 – Close Unwanted and Unneeded Accounts
It probably makes sense that you should close out any unwanted or unneeded accounts at this time. The only exception is that you may want to keep one joint account open, in case you receive a check payable to the deceased. You may be able to place this check into the joint account by signing it over for “place Only”. This could save you an expensive trip to the attorney or surrogate court’s office later.
Item 7 – Revise Wills and Powers of Attorney
It is always a good idea to review your wills, strength of attorney, medical directives, health care proxies and any trusts that you may have established on a regular basis at the minimum every 3 to 5 years. It becomes already more important after the death of a spouse or parent. You may need to revise executors, trustees, and other appointees to mirror the current situations.
You will also want to look at your existing beneficiary arrangements and see if they can be simplified, alternation and corrected to better represent your current wishes. These can be done with an attorney, or online, or with one of the many legal software programs that are obtainable. The meaningful is to make sure they get revised, executed, and notarized as needed.
Item 8 – Review Real Estate Ownership Arrangements
If the deceased owned any real estate on their own or jointly with others, you will need to take a look at how this will be affected by their death. There are certain rights that joint owners of real estate can have, or not have, depending on the kind of ownership. It can also differ from one state to the next depending on whether the owner was a resident or held the character for vacation purposes.
Once you have a clear picture of what kind of ownership arrangements exist, you can then begin looking into how it should and will be handled. You may need to consult with a real estate attorney, but I would begin by asking what they charge for a “Real Estate” transaction.
Only after you find this out, mention that this will include a deceased owner. It may cost a little more as real estate transaction for a deceased owner, but if you mention it as an estate transaction, many attorneys will try to charge a much higher fee, (possibly up to 5% of the value of the house) run it by probate and the estate course of action. This could cost you thousands instead of hundreds of dollars if you let them. But now you know better.
Item 9 – Protect and Preserve Your Assets From Fraud
Today we have a whole new copy of criminals out there. Many of them prey on widows and senior citizens. They have no conscience and are more than willing to take advantage of anyone that is willing to listen to their story.
Make sure that you have one or more trusted children, siblings or friends review any kind of financial “opportunities”, investments, donations or scams before you decide to part with your money. These con-artists will try to get small amounts at first, then escalate their fraudulent activities to much larger amounts once they feel they have you on the hook.
Don’t let this happen. Always contact one of your Trust Team members before making any big or suspicious decisions.
As we get older, making good decisions can become more difficult. It becomes already more difficult if you just lost a loved one and are in the time of action of grieving. Don’t let anyone rush you, but listen to your Trusted Team members if they tell you that you need to do something now. Ask them to explain why it needs to be done closest or if it can wait until you are ready. Some items do require more urgent attention, especially if your loved one passed away closer to the end of a calendar year.
The majority of these items can be handled over a period of time when you are ready to address them. I suggest that you take them one at a time and ask for help from your Trust Team members. Finish one, then move on to another, until you complete them all. If you attempt to do them all at once, you may end up frustrated and unwilling to continue. There is a great saying… “This Too Shall Pass”. Remember that, when you are feeling overwhelmed. This Too Shall Pass!