Death is something most of us would rather not think about, but losing a spouse brings financial responsibilities that need attention. Knowing what to prioritize can make things easier for yourself if you’re the surviving spouse, or help you prepare your own affairs for your spouse or other beneficiaries. After a death, the surviving spouse will typically need to notify financial institutions, file life insurance claims and, in some circumstances, carry out the instructions in a will.
Important documents and information to locate include:
- A will
- Life insurance policies
- Financial statements
- Passwords for digital accounts
Firstly: if you’re named as the beneficiary of a life insurance policy, making a claim generally requires filling out a claim form and providing a copy of the death certificate. Funeral homes can often help families with obtaining death certificates. It’s a good idea to request 10-12 copies, since several organizations may require one. Also, life insurance benefits generally do not have a deadline for filing a claim.
Insurance coverage also needs attention after a death. A spouse or other family member should contact the deceased person’s insurance providers, including health, dental and disability insurers, to notify them of the death and cancel coverage when appropriate. If those policies were provided through an employer, however, the company’s human resources department should typically handle this.
Another important precaution is freezing the deceased person’s credit. Identity thieves sometimes use information found in obituaries or other public records to attempt to open credit accounts in the name of a deceased person. Freezing their credit can help reduce that risk.
Probate court is responsible for overseeing the administration of wills and the distribution of certain assets that do not have designated beneficiaries. That’s one reason having an up-to-date will is so important. Assets owned jointly with a spouse, however, may not have to pass through probate. Depending on how ownership is structured, the deceased spouse’s name may be removed, and the surviving spouse may become the sole owner if no other individuals share ownership.
Married couples also frequently name each other as beneficiaries on retirement plans, bank accounts, and brokerage accounts. If your spouse passes away, remember to review and change the beneficiary designations on your own accounts as necessary. This is also an important time to revisit your broader estate plan. Documents such as your will, power of attorney and healthcare designee should always be kept up-to-date. The death of a spouse is an example of a major life event that will often require those documents and designations to be updated.
Source: U.S. News
This material is provided for general informational and educational purposes only and is not intended to provide, and should not be relied upon as, individualized financial, investment, tax, legal, estate-planning, insurance, or accounting advice. The appropriate steps following a death depend on individual circumstances, applicable state and federal law, account ownership and beneficiary designations, insurance policy and employee benefit plan terms, and other factors. Financial professionals do not provide legal or tax advice unless separately qualified to do so. Individuals should consult their attorney, tax professional, insurance carrier, plan administrator, financial institution, and/or other appropriate professional regarding their specific circumstances. Insurance and financial product availability, terms, benefits, and requirements may vary. Information is believed to be accurate as of the date of publication but is subject to change.
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