After the funeral has been arranged, the processions have taken place, and the out-of-town guests have gone home, what do you do now? In Part 3 of the funeral arrangement process, we review financial accounts that need to be addressed after the funeral is over. To help keep you organized, we have included this information on the Funeral Planning Checklist.
Determine what bank accounts were opened in the deceased's name and ensure you have the authority to make changes (i.e. the Executor of the Will or personal representative) to them and manage the finances for any outstanding bills. Basic information on the deceased as well a copy of the death certificate will likely be necessary to make any changes and close the accounts.
Similar to bank accounts, it is important to establish what credit cards accounts are still opened. An easy way to see all credit cards and debts that exist is to order a credit report for the deceased. This report will list any accounts that have ever been opened, closed, and are active. Usually a call to the credit card company with the name, date of birth, and social security number will be sufficient to access and close an account with a $0 balance once the credit card company has been informed of the death. A death certificate may be needed for their files, so be prepared with an extra copy for this purpose. However, if a balance exists on the account, look into your state's laws as how the debt is handled. In general, all debts belong to the estate and should thus be paid by the estate. If there is not enough money or assets in the estate to satisfy the debt, the debt may need to be written off by the credit card company. Credit card companies cannot come after a spouse or heir if there is an unpaid balance after exhausting the estate and deceased's assets unless you live in Community Property states such as:
- New Mexico
In these states, the credit card company can legally collect debt from the spouse before the card is closed.
Most retirement accounts have named beneficiaries making it easy to determine who is entitled to the funds when someone passes away. However, retirement accounts come with many financial and tax complications so be sure to consult with a tax specialist before making any changes or rolling funds into other accounts. About.com provides more information on this topic as a starting point for information gathering: What Happens to a Retirement Account What the Owner Dies?
Consider any mortgage, rent, nursing home or hospice fees that will be due for housing.
If the deceased was living on their own, make a list of all the utility companies necessary to support the house, such as water, electricity, gas, cable, and phone. For a fully downloadable funeral planning checklist, visit the Resources section.
This article is meant as a resource to enhance your thought process and is not finite nor is its purpose to provide legal or tax advice. Always consult with specialists when it comes to tax, legal, and financial matters.