The surviving spouse is often responsible for settling the estate after the death of a spouse.
Outliving loved ones is hard.
It can be especially challenging if the deceased loved one is your spouse.
In addition to the devastating loss of your best friend, you will likely have to oversee the estate and all funeral arrangements.
People come to you requiring quick decisions ... and bearing invoices for those funeral services and other final expenses.
The process can be overwhelming if you do not know what actions you must take to settle the estate and secure your future.
When settling an estate or trust, the overall process may be formally known as administration.
However, in our law practice, we refer to it as administrivia.
You will appreciate our moniker for estate and trust administration once you find yourself caught up in the process.
Navigating life and responsibilities after the death of a spouse is challenging.
Within days of the death of your spouse, you will need to obtain multiple certified copies of the death certificate.
Why?
Insurance companies, financial institutions, and government agencies will all require documentation of the death to comply with the wishes outlined in the last will and testament or beneficiary designations.
Where can you get these death certificates?
For these certified copies, the funeral home commonly applies to the appropriate state agency (e.g., the Department of Vital Statistics).
In our experience, ordering a dozen is a good rule of thumb.
Certain financial institutions, government agencies, and other third parties may accept copies of death certificates, but many will not.
In addition to gathering the death certificates, you must prioritize locating the last will and testament or trust.
The executor will not be able to begin managing the estate and distributing assets until the original last will has been provided to the court and deemed valid by the probate judge.
What happens if there is no last will?
What if the last will does not exist, the original cannot be found, and there is no curative process under state law?
In that case, state intestacy laws may direct estate administration and asset distribution.
Another action you must take involves Social Security.
If your spouse had been receiving Social Security benefits, you will need to contact the Social Security Administration to inform them of the death.
Although the payments being made to your spouse will stop, you may be eligible for financial support through survivor benefits.
If your spouse owned a life insurance policy and you are the designated beneficiary, you should file a claim to receive the payout.
The death of a spouse can lead to significant financial changes.
You must notify all credit card companies, banks, and investment firms to remove your spouse's name from ownership.
If you and your spouse jointly owned assets, the assets will be transferred to your ownership automatically after supplying the certified death certificate.
When accounts were owned individually by your spouse, they will be governed by probate for distribution before they can be accessed.
However, if real estate is not subject to probate, your state's small estate affidavit may be used, subject to specific dollar limitations.
For example, the ceiling is $75,000 in Kansas and $40,000 in Missouri.
By the way, that limitation is on the total value of all "orphaned" assets.
Other providers to inform of the passing include utility companies, insurance providers, and mortgage lenders.
You will need to find out if you are legally responsible for your spouse's outstanding debts.
You may need to sell some estate assets if you are responsible.
When a trust has been created and funded as a part of the estate, trust assets can be distributed directly to beneficiaries outside of probate or held and administered according to the trust terms.
Without a funded trust, assets will require probate proceedings for distribution.
Probate attorneys can provide helpful direction for navigating probate, settling debts, and distributing assets.
While we provide no probate or trust administration services, we work with attorneys who do.
After the death of a spouse, the surviving spouse will need to update estate planning documents.
If your spouse was listed as your beneficiary on life insurance polices, retirement accounts, or payable-on-death accounts, you must select other recipients and update the designations.
Your last will and testament, trust, and power of attorney must also be reviewed.
If you had listed your spouse as your executor, trustee, or agent, you must name other individuals to fulfill these roles.
If you do not update your documents, your plan may not function effectively, and your loved ones may be stuck sorting out a mess.
In addition to your beneficiary designations and estate planning documents, you should review your property deeds.
You may update your deeds to account for you being the sole owner, especially if it would be subject to probate at your death.
Although some states allow property to transfer to the surviving owner automatically, other states may require you to file new paperwork with the county.
Your long-term financial planning will also change as a result of your widowed status.
You may need to adjust your budget, retirement planning, and investment strategies to account for a single income.
If your spouse had annuities, employer-sponsored retirement plans, or pension benefits, you should reach out to see if you are eligible for survivor benefits or continued payments.
If you did not have a financial advisor and your spouse handled household finances, you should interview and retain a financial advisor.
Taxes should also be a focus after the death of a spouse.
You will need to file a final tax return for your spouse, and it will be your last opportunity to file as a married couple.
Your state may be owed additional funds for inheritance or estate taxes, depending on where you live.
Yikes!
Discussing your situation and tax liability with a financial advisor or estate planning attorney can help you wisely manage your assets and avoid future legal conflicts.
When a spouse dies, life changes significantly.
Those who seek out financial and legal guidance often find greater security for their financial future and reduce the risk of making common mistakes.
If your spouse has recently died and you want to update your estate planning documents, you can request a consultation at Harvest Law KC in Overland Park, Kansas.
After the death of a spouse, estate planning documents and certified death certificates must be located and gathered.
It is important to notify banks, insurance providers, and the Social Security Administration of the death to update benefits and accounts.
The surviving spouse must review and update personal estate planning documents if the deceased spouse was listed as the fiduciary, agent, or beneficiary.
Although many people leave assets, some people die with debt.
Creditors, mortgage lenders, and utility companies will need to be notified of the death, and outstanding payments may need to be settled.
The financial life of a single person may require changes to budgets, investments, and taxes.
Taking action and seeking professional support after the death of a loved one can provide greater financial stability and peace of mind.
This post is for informational purposes only and does not provide legal advice. You should contact an attorney for advice concerning any particular issue or problem. Nothing herein creates an attorney-client relationship between Harvest Law KC and the reader.
Reference: Principal Financial Group (Dec. 19, 2023) "What to do when your spouse dies: a financial checklist"
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