Dec 10, 2012

Managing Finances After a Death in the Family

Bank Accounts
When a family member passes away loved ones are usually left with many financial decisions. To help ease this burden, we recommend setting up re-planned funerals, account beneficiaries and wills while living. Of course this is not always possible and in most cases family members will still need to deal with some financial issues.

It’s helpful to have an attorney or the executor of the estate advise you on a deceased’s bank accounts. Different types of accounts differ in their requirements for access:
  • Joint Account: If you have a joint bank account with the deceased, control over the account can go to the survivor. The survivor can continue to make payments, deposits, and changes as usual. To remove the deceased from the account, you must show a valid death certificate.
  • Traditional Bank Account: With a traditional account, the deceased had sole control over the account. In this case the money goes to the individual(s) named as beneficiaries. If there are no beneficiaries listed, the funds go to the estate. To access the account, the beneficiaries or the executor of the estate must have the death certificate.
  • Trust Account: Usually set up as part of a larger estate plan, a trust names the beneficiary of the account and identifies how the funds will be distributed.
  • Safe Deposit Boxes: Safe deposit boxes are similar to traditional bank accounts. To access, you will need a certified death certificate and legal documents identifying the executor of the estate. 

To Start ... 
  1. Request numerous copies of the death certificate through the funeral home or your state Department of Health.
  2. Contact each financial institution where the deceased had accounts. Most likely you will be asked to set up a meeting with a financial advisor. Make sure to ask what proof of identity you need to bring to the meeting.
  3. Review any financial statements you find in the home of the deceased. Many times loved ones find additional bank accounts or safe deposit boxes.
  4. Comply with the will or estate executor. Remember, legally you are bound by their wishes, even if you don’t agree with their decisions. 

This process often isn’t easy and is sometimes even more difficult given the emotions that come when dealing with finances. Remember, by preparing ahead—through funeral pre-plans, estate planning and wills—you can ease the process for your loved ones.

Few people die with all financial details in order, but before you start writing checks or panic about expenses, take time to learn your rights and responsibilities.

 Managing Bills
1) List all the deceased’s liabilities, including mortgages, bills, lines of credit, loans, etc.
2) Divide the liabilities into administrative expenses (bills that will continue to need payments, such as a mortgage) and final bills (bills that can be paid in full, such as funeral expenses). Administrative expenses will be paid by the executor of the estate out of any funds currently in the estate.
3) Make decisions about maintaining payments. Keep records of all payments for the estate’s financial records.
4) Determine what can be sold. This is usually the executor’s responsibility. Selling items may be necessary to cover debts.

This information is not intended as a substitute for legal advice and we urge you to obtain competent legal advice for any questions regarding financial matters following the death of a loved one.

Watch this video for even more tips from Bank of Luxemburg Chief Operating Officer Rebecca Edler:


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