What to Do After Losing a Loved One - A Financial Checklist for Family & Friends

Losing a loved one is difficult. In fact, I can't think of anything more devastating than the death of a loved one. The death of anyone especially close to us creates an interruption to the flow of our everyday lives. It takes time to recapture our sense of equilibrium, and our awareness of everyday tasks and responsibilities.

That's why I created this checklist to help you. As you feel your own life pausing as you grieve your loss, these pointers will help take care of your finances and those of your loved one. This checklist is designed to help you navigate your way through the initial days and early weeks after a loved one has passed.

Here Is Your Financial Checklist of Things to Do Once You Lose a Loved One

1. Did you figure out how you are going to keep track of what needs to be done and when? I suggest creating a calendar to note key events and activities that happen during this time period.

2. Have you notified family members and friends? This might sound obvious, but it is important that family and close friends be notified promptly. If you are unable to make these calls personally, ask someone close to you to assist you in relaying the news and the details. If family and/or friends do not live locally, they may need time to make travel arrangements to arrive in time for the funeral.

3. Did you make final arrangements? Unless your loved one made their own funeral arrangements during life, someone will need to coordinate these details at this time. If you do not already know your loved one's wishes, you should look among his or her papers to see if he or she left any instructions regarding their wishes regarding their funeral, burial and cremation. You will need to contact the funeral home and, if appropriate, the individual's clergy. If your loved one was a veteran, you may be eligible for burial and memorial benefits.

4. Did you obtain certified death certificates? The family doctor or medical examiner should complete the death certificates within 24 hours of the death. The funeral home will then complete the form and file it with the state. You will need several certified copies of the death certificate to handle the individual's estate and to request any benefits payable as a result of the individual's death (such as life insurance, annuities and qualified retirement plan assets).

5. Have you notified social security and did you contact all financial institutions? Typically, the funeral home will notify Social Security of an individual's death. However, if they do not handle that for you, you must call them. If your loved one was receiving Social Security benefits via direct deposit, request that the bank return the funds received for the month of death and any subsequent months. Be careful to not cash any social Security checks received by mail. You should return any checks received by mail as soon as possible. Surviving spouses and other family members may be eligible for a one-time $255lump-sum death benefit and/or survivor's benefit.

You should also contact all financial institutions where your loved one held assets and ask that them to put a freeze on the accounts. Likewise, if your loved one held any credit cards, you should notify all of such companies of his or her death and cancel all such cards.

6. Did you start collecting asset information? Collecting information about your loved one's financial affairs may or may not prove challenging. If you were not familiar with your loved one's finances (as many children do not know their parents' finances), collect the bank statements as they come in each month and each quarter. It may take a few months for you to gather all of this information. Also, you can review your loved one's tax returns to see what investment assets they may have possessed.

7. Did you look into collecting Life Insurance Benefits? Often, it is important to collect the death benefit of an insurance policy promptly after your loved one's death so that cash is on hand to pay funeral related expenses. You need not wait to collect the death benefit on an insurance policy until after an estate has been raised.

8. Have you checked to see if you need to raise an estate? You may or may not need to "raise an estate" after a loved one has died. Raising an estate simply describes the probate process by which someone is legally appointed to administer the estate. Whether or not an estate needs to be raised will depend (1) on the size of the estate; (2) the nature of the person's assets; and (3) who the beneficiaries of the estate are. If there is any question regarding whether or not an estate should be raised, you should consult with an estate attorney.

9. Have you chosen a professional financial planner to help you make important financial decisions regarding your inheritance? The world is full of people who have suggestions on how to spend your money, especially if they believe you've just received an inheritance check or a life insurance check. If you have important decisions to make about money, consider trusting a professional financial planner. And, if you have questions regarding how to choose a financial planner, check out my free consumer guide at: chooseyourfinancialadvisor.com

This list is a starting point. As you begin to take care of these affairs, others will arise. As difficult as it may be to accept, the outside world will continue to make demands on grieving family members despite your inability to focus. This is not a time to neglect your financial responsibilities. Once your days become more normal again, you will be greatly relieved if you've paid attention to these financial details.