Finances & Farewells: How to Settle A Loved One’s Accounts

Handling Finances After a Death

When coping with the loss of a loved one, it's natural to feel overwhelmed with grief. In addition to the emotional burden, the responsibility of handling finances after death often falls on the person most directly affected by the loss. Financial matters, especially after the funeral or memorial service arrangements, can be confusing and challenging to navigate. This is even more difficult when there is no will or plan laid out for reference. That's why planning ahead and knowing the necessary steps is key to alleviating some of the stress during this time.

Step 1: Make a List

The first essential step is to create a list of the financial tasks that may require attention. Having this list prepared ahead of time will help you stay organized when the barrage of questions arises. While not comprehensive, here are some important financial considerations in the aftermath of a loss.

Step 2: Acquire Death Certificates

When it comes to managing the financial matters of a loved one who has passed away, having death certificates is often a precursor to everything else. Many important tasks, such as closing bank accounts or transferring assets, require a death certificate as proof. To determine how many copies you may need, it's helpful to assess the number of matters that need to be settled. You can obtain additional death certificate copies from your county or state’s Vital Statistics Department as needed to ensure you have enough.

Step 3: Obtain Social Security Benefits

If you are a spouse or dependent child of the deceased and entitled to their Social Security benefits, it's essential to reach out to your local Social Security office. They will guide you through the necessary steps to ensure you receive the benefits you are entitled to. Initiating the process as soon as possible will help avoid any delays in receiving the support you may need during this difficult time.

Step 4: Claim Life Insurance

If your loved one had a life insurance policy, it's important to notify the insurance company about their passing. Contact the company and provide them with the policy number and a certified copy of the death certificate. These documents are necessary to initiate the process of receiving the life insurance claim. The insurance company will likely provide you with a claim form that needs to be filled out accurately and promptly. Taking these steps will ensure that you are able to access the financial support provided by the policy.

Step 5: Settle Health Insurance and Other Policies

In addition to life insurance, it's important to reach out to the health insurance company of the deceased. Especially if other family members are covered under the policy, you need to ensure that any necessary steps are taken to address these matters. Contact the insurance company to discuss the next steps and to confirm how the coverage will be affected by the passing of your loved one. This will help you navigate any medical expenses and ensure the smooth continuation of health insurance for the remaining family members.

Step 6: Explore Employer-Related Benefits

If the deceased was employed, it's essential to connect with their employer to gather information regarding any employer-related benefits. This may include pension plans, credit unions, or other death benefits that they may have been entitled to. Each claim for these benefits may require a certified copy of the death certificate.

Step 7: Deactivate Credit Cards

When it comes to managing the credit cards of the deceased, you have a couple of options. You can choose to return the credit cards to the respective companies or you can notify the credit card company if you, as the survivor, wish to retain the use of the card. If you decide to keep using the credit card, it's important to get in touch with the credit card company and let them know about the passing. In most cases, they will likely require a certified copy of the death certificate. Taking the necessary steps in a timely manner will help ensure that you avoid any unwanted fees for cards you want deactivated.

Step 8: Manage Funeral and Cremation Costs

Funeral and cremation expenses can be a significant concern when dealing with end-of-life arrangements. Understanding the costs and planning accordingly can help alleviate some financial stress during this time.

Funeral costs can vary depending on different factors, such as the location, type of service, and additional offerings chosen. A traditional funeral service, including a viewing, ceremony, and burial, typically costs between $7,000 and $10,000 or more. Cremation costs tend to be lower, with an average range of $2,000 to $6,000.

Understanding how to handle funeral expenses can be a daunting task, however, there are proactive steps you can take to navigate these financial responsibilities. First, review the deceased's financial arrangements, including any prepaid funeral plans or funeral insurance policies they may have had. 

Next, consult with the funeral home or crematorium to discuss the available payment options, such as installment plans or financial assistance programs. Also consider reaching out to family and friends who may be willing to contribute or help with fundraising efforts. It's advisable to gather multiple quotes from different funeral service providers to ensure you are getting the best value for your budget. 

Finally, remember that it is okay to ask for help or seek financial advice from professionals or support organizations specializing in end-of-life planning. Their expertise can provide valuable insights and guidance to ease the financial strain and ensure that your loved one's final arrangements are handled respectfully and within your means. You have the power to make informed decisions and take control of the financial aspects, honoring your loved one in a way that aligns with their wishes and your budget.

Help Your Loved Ones by Planning Ahead

Handling financial issues after death is no small feat. To help your own family in the future, consider setting plans in place and preparing your end-of-life information ahead of time. Additionally, consider discussing your preferences with trusted family members or friends, as they can provide valuable support during these discussions and help ensure your wishes are met. To learn more about planning ahead, visit our article here. Or, take a look at what scams you need to be aware of when you've recently lost your loved one.

During the challenging time of grieving the loss of a loved one, it's crucial to take care of your financial matters with empathy and practicality. By planning ahead, making a comprehensive list, and addressing important tasks, you can alleviate some of the potential stress. Remember, you have the power to make informed decisions that honor your loved one's memory while also taking care of your own financial well-being.