The death of a family member triggers an avalanche of paperwork at a time when you're least equipped to handle it. That's why my first piece of advice for the bereaved is the most important: Delay all financial decisions for at least six months. During this time, devote yourself to your grief and your family. Spend time with loved ones, not lawyers, accountants, and bankers.
Keep in mind that the vast majority of financial, legal, and tax issues can wait months before they need attention, so don't feel as though you're under pressure to make decisions quickly. You don't even need to open the mail — it too can wait. However, there are a few administrative tasks that should be addressed. Follow this checklist — or ask a trusted friend or key family member to help you go through it quickly and easily.
- Determine if the deceased had engaged in pre-needs planning. A growing number of Americans pay in advance for their own funeral and burial services. Try to find out if the deceased did that, so you can avoid paying twice.
- Locate important documents. Examples include the deceased's original wills, trusts, deeds, and titles to real property, Social Security card, marriage and birth certificates, honorable discharge papers, and recent tax returns.
- Order at least 10 copies of the death certificate. Most institutions you'll deal with will want one. You can get them from the funeral home for a nominal fee or from your state's health department.
- Inform financial professionals. Tell your financial planner, tax preparer, and estate attorney. Make sure each is aware of the others, as teamwork is essential. Before work begins, address the fees associated with efforts to settle the estate. Be an informed consumer.
- Gather all insurance contracts. Examples include life, mortgage, auto, disability, and long-term care insurance. Inform the agent who sold the policies or the insurance companies of the death. Insurance companies may send you information and paperwork so you can cancel coverage no longer needed or begin the distribution of benefits to you.
- Call the deceased's current or former employer to learn about retirement plans, pension benefits, health and life insurance coverage, and other employee benefits the spouse may be entitled to receive.
- Contact the Social Security Administration to determine the surviving spouse's benefits and start the claims process. Claims can be expedited by making an appointment at your local office. When making the appointment, ask what you should bring to the meeting. They will require proof of death, proof of age and dependency of children, proof of marriage and divorce if applicable. Social Security pays a one-time death benefit of $255 toward burial expenses (if there is a surviving spouse or children). Your funeral director can complete the application and apply the amount towards your bill. If the deceased has minor children, they may be entitled to receive SS benefits, so be sure to ask. And if the deceased had been receiving SS benefits, talk with the SSA before you cash any check you receive after the deceased's death.
- Compile a list of the deceased's assets. This includes bank and investment account statements, real estate holdings, collectibles, vehicles, and other assets owned by the deceased at the time of his or her death. If documents were not kept in a central location, watch the mail and save every envelope that looks like it might be financially related. Later, you or a family member can review the paperwork.