In last week’s post, we discussed ways to plan ahead for your funeral and how taking such proactive steps can be a true gift to your loved ones during a difficult time. But there’s another crucial step within the advance planning process: Compiling important documents and records that will be needed by your surviving family after you are gone.
When a loved one dies, there is an inevitable period of grieving. But alongside the emotional loss comes a long list of practical responsibilities and to-dos: notifying government agencies, managing accounts, securing property, filing insurance claims, and dealing with taxes and other estate matters, just to name a few.
Knowing what needs to be done, and in what order, can make this process less overwhelming for grieving loved ones. And when an older adult has proactively taken the time to organize their affairs prior to their death, the tasks left to their family can be further simplified.
Let’s walk through some of the tasks that must typically be done by a person’s loved ones after their passing and certain steps you can take in advance to simplify some of these to-dos.
>> Related: Planning Ahead for Your Funeral: A Final Gift to Loved Ones
Gathering important documents and information
Before closing accounts or making major financial decisions, loved ones must determine who has legal authority to handle the deceased person’s affairs. Depending on the situation, this may be a surviving spouse/partner, executor, trustee, or court-appointed personal representative.
The family will need crucial documents such as:
- The will
- Trust documents
- Financial statements
- Insurance policies
- Retirement and pension information
- Property and vehicle records
- Recent tax returns
- Employment information (if still applicable)
Order multiple certified death certificates
Death certificates will be necessary when dealing with banks, insurance companies, pension administrators, and many other organizations. Because requirements vary, there is no universal number of copies every family needs, but obtaining several certified copies at the outset can be more convenient than repeatedly ordering them later.
The family should keep track of which organizations receive certified copies and whether they return them. Don’t automatically send an original unless it is specifically required.
Notify the Social Security Administration
Funeral homes generally report deaths to the Social Security Administration, so families typically don’t need to make a separate report. However, if a funeral home isn’t involved or doesn’t report the death, the family will need to contact Social Security directly. The Social Security Administration’s guidance on what to do when someone dies explains the process.
This is an important to-do because the deceased person’s benefits generally stop, while eligible family members may still qualify for survivor benefits. Social Security also provides a one-time $255 lump-sum death payment to certain eligible survivors.
>> Related: Saying Goodbye: How a CCRC Helps Residents Grieving the Loss of a Spouse
Contact employers, insurers, financial institutions
If the deceased was still working or even recently retired, their employer’s human resources or benefits department must be contacted. Ask about final pay, life insurance, pensions, retirement plans, health insurance, and other benefits.
Notify life, homeowners, auto, and other relevant insurance companies as well. A surviving spouse or estate representative may need to file claims, change ownership or beneficiaries, or determine whether coverage should continue.
For bank and investment accounts, don’t immediately close everything. Joint ownership, beneficiary designations, and the terms of the account determine what happens after death.
Automatic payments also need to be reviewed so that important expenses such as mortgages, utilities, and insurance aren’t inadvertently interrupted.
>> Related: Working After Retirement …or Not: How to Facilitate Both Options
Secure the home and mail
If the deceased lived alone, be sure to secure their residence, vehicle(s), valuables, and important documents. Arrange for pets and property maintenance, and contact the appropriate insurer if the home will be vacant.
Additionally, don’t overlook or immediately discard the mail. It can reveal financial accounts, bills, insurance policies, and other information that may have been overlooked or not included in the deceased’s records. The U.S. Postal Service generally requires an executor or administrator to provide documentation establishing legal authority to have the decedent’s mail forwarded to an alternate address.
Notify creditors … and watch out for fraud
After identifying the deceased person’s accounts, contact banks, credit card companies, mortgage lenders, and other creditors as appropriate. Don’t assume every debt becomes the responsibility of a surviving spouse; liability depends on the type of debt, contractual ownership, and applicable laws. The Federal Trade Commission’s guidance on debts and deceased relatives explains some of the protections and responsibilities involved.
Unfortunately, fraudsters often try to take advantage of people when they are most vulnerable. It is therefore important to continue to protect the deceased person’s identity (such as the Social Security number and other account information). A deceased person’s credit file can be updated to indicate the death, which can make it more difficult for criminals to use that person’s identity fraudulently.
Reviewing credit reports can also uncover accounts the family didn’t know existed. Preserve financial records long enough to investigate unfamiliar bills or accounts rather than immediately shredding everything.
>> Related: Don’t Become a Victim to the Rising Incidence of Elder Fraud
Review and cancel accounts
Over the first weeks and months following a loved one’s death, review any recurring expenses and services such as utilities, internet and cellular service, streaming subscriptions, memberships, newspapers, and online services. Some accounts may need to be canceled, while others should be transferred to a surviving spouse/partner or kept active while the estate is settled.
Don’t overlook digital accounts such as email and cloud storage, too. Some may contain information the estate needs before they are closed.
Take care of taxes and government records
The person’s financial responsibilities don’t necessarily end at death. As the IRS explains, a surviving spouse or personal representative may need to file the deceased person’s final federal income tax return, reporting income through the date of death. Depending on the estate and the state of residency, additional tax filings may be required too.
Other administrative tasks may include updating or canceling:
- Driver’s license
- Vehicle registration
- Voter registration
- Professional licenses
- Memberships and permits
Keeping track of post-death tasks
The administrative work required following a loved one’s death can feel overwhelming, especially when added to the emotions that come with grieving. But there are some ways to make the process less daunting.
A simple tracking document can be helpful, such as a shared Google spreadsheet. Record the name of each organization contacted, date, person spoken with, any documents provided, and any remaining action. This prevents loved ones from repeatedly wondering whether something has already been handled. Keep relevant documents and paperwork filed accordingly.
The key is to remain organized, whatever way is simplest for you.
Keeping records organized can also help protect against fraud. The FTC recommends protecting sensitive financial and personal information and monitoring credit reports for signs of identity theft. Its identity theft guidance provides additional steps for protecting the decedent’s personal information and responding to suspected fraud.
>> Related: Planning for the Future After a Spouse’s Death
What you can do in advance to help your grieving loved ones
For older adults, preparing for the future often means thinking about where they want to live, what kind of care they may eventually need, and how they will pay for it. Those are all essential decisions that must be made.
But planning for the future should also include thinking about what happens when one is no longer here to manage day-to-day accounts and tasks. This lengthy list of administrative to-dos following a death underscores why organizing one’s affairs in advance can be such a meaningful gift to grieving loved ones.
To get you started with your planning, here are some important tasks you can do right now that will ease the burden on your loved ones when you’re gone.
>> Create a central file (physical or digital) with account numbers, insurance policy numbers, financial institution names, professional contacts, and information about recurring bills and subscriptions.
Ideally, your advanced planning file should include the location and/or details about:
- Your will, trust, and other legal documents related to the estate
- Bank, investment, retirement, and credit accounts (Ensuring these accounts have beneficiaries and/or POD designations can save a lot of trouble later.)
- Insurance policies and beneficiary information
- Property and vehicle records
- Employer and pension information
- Regular/recurring bills and subscriptions
- Important professional contacts (like attorney, accountant, financial advisor, etc.)
- Digital accounts and password-management information (especially for email since many bills and invoices are accompanied by an email notice)
- Funeral preferences and final wishes (as discussed in our recent blog post)
>> Review your planning information periodically as accounts can change, policies expire, and financial circumstances may evolve. Keeping an up-to-date account inventory will make the settlement process dramatically easier for your loved ones. It also reduces the chance that an account, subscription, or financial obligation will simply be forgotten.
>> Set up a password manager tool with an emergency-access feature. Your digital (online) information and accounts will need attention, too, so a password manager can be safer and more practical than maintaining a handwritten list of passwords. The important thing is that a trusted person knows where these documents and this information is kept and how to access it.
>> Ensure a loved one knows where to locate any valuables within your home so they can be secured.
>> Proactively enroll in automatic online billing for accounts that offer it. This eliminates the risk of important bills getting overlooked in the mail. But be sure to record the account within your central file so your loved ones are aware of it.
Simplifying a complex process
The administrative work following a loved one’s death can feel like an enormous job, but remember: It doesn’t all have to happen immediately. Funeral arrangements, securing physical property, and addressing Social Security are priorities that require prompt attention. Canceling subscriptions, sorting belongings, and handling less urgent paperwork, on the other hand, can generally wait.
The exact requirements will vary depending on the person’s state of residency, assets, and family circumstances. For complicated estates, probate, trusts, and tax matters, always consult an experienced attorney, tax professional, and/or financial professional.
No amount of proactive planning by an older adult can completely eliminate the estate-related work that their family will face. However, organizing important information, communicating where it can be found, and keeping it current can give loved ones something invaluable during a difficult time: clarity about what needs to be done, and confidence about where to begin.
