End of Life Planning for Your Parent
Losing a parent can be one of life’s most difficult experiences, at any age. There are often time-sensitive and practical matters to attend to during what is sure to be an emotionally overwhelming time. When possible, asking for support from friends, family, or other resources can be critical to get through the early days on an emotional level.
Finances, for one, can feel like a maze of paperwork, digital records, passwords and perhaps even shoeboxes full of old papers. Here are some of the initial practical steps that may need to be taken in the hours and days following a loss.
Know your Parent’s Wishes
Many people don't have a window of time to prepare for a death before it happens. For those that do, it can sometimes be an opportunity to discuss their wishes and fears with their family. Some families also use the time to try to align with family members and handle logistics around the location of important documents or other financial or legal matters.
- Know the location of the will, birth certificate, marriage and divorce certificates, Social Security information, life-insurance policies, financial documents, and keys to the safe deposit box or home safe. Ask the person to create an inventory of their digital assets (such as email, social networks, and digital files).
- If possible, retitle accounts into joint name, and or add additional trustees to revocable trusts.
- Ask about the loved ones wishes concerning funeral arrangements, organ donation, and burial or cremation.
- Have the person complete an advance directive, including a living will, which specifies wanted and unwanted procedures. The person should also appoint a healthcare proxy to make medical decisions if he or she becomes incapacitated.
- Ask the person about end-of-life care, and what their insurance will cover. Medicare, which covers most elderly Americans, will cover hospice care.
- Have a do-not-resuscitate (DNR) order drawn up if the person desires. A DNR order tells healthcare professionals not to perform CPR if the person’s heart or breathing stops and restarting would not result in a meaningful life.
What to do right away
At first, it may be hard to think about money, but there will be important decisions to make in the days following your parent’s passing. It may help to take care of pressing concerns as early as you’re able, then take a little time before moving on to the next set of tasks.
- Get a legal pronouncement of death: If the person dies at home under hospice care, call the hospice nurse, who can declare the death and help facilitate the transport of the body. If the person dies at home unexpectedly without hospice care, call 911. Have in hand a do-not-resuscitate (DNR) document if it exists.
- Secure your parent’s home: Ask a friend or relative to keep an eye on the home, collect mail, toss older food out, water plants, and monitor the temperature. We recommend forwarding the mail as soon as possible, as many identity theft criminals pray on the recently deceased.
- Monitor emails: Consider delaying notification to email providers and monitoring the content for six months to a year. Unknown assets may surface through email notifications.
- Contact their attorney, financial advisor and tax advisor. The financial professionals your parent(s) worked with may have insight into their plans.
- Gathering official records: Getting access to your parent’s financial accounts may require proof of death, so this should be done as soon as you can. Most counties have an office of vital statistics that houses birth, marriage and death certificates, and some allow you to request those online.
- Contacting Social Security: If your parent was receiving Social Security benefits, reaching out to the Social Security Administration will ensure that payments stop, and keep you from having to repay the government. This may seem like something that can wait, but the government says it should be done as soon as possible. The funeral home may do this for you, but if not call 1-800-772-1213. If your parent’s spouse plans to apply for survivor’s benefits, or if you have other questions, visit SSA.gov.
What to do in the coming weeks
While you’re still in mourning, there will be certain things that need some attention in the weeks and months following the funeral, which can be very difficult. But this would be the time to review your parent’s will, settle their debts and make decisions about any property they own, perhaps even a family home.
- Contact insurance companies and providers: If your parent received Medicare, the Social Security Administration should cancel coverage. But if they had supplemental Medicare coverage, private health insurance or prescription drug coverage, you’ll need to contact each plan by calling the phone number on their ID card or statement.
You should also notify life insurance companies to start the process of filing any available claims. Also be sure to cancel any other insurance policies your parent may have carried, like auto insurance. Each state handles homeowner’s insurance following a death differently, contact their insurance broker to understand the coverage and insure it continues.
- Secure the will: Naturally, a checklist for the death of a parent involves finding their will. If you’re not sure there is one, ask friends, siblings or your parent’s lawyer whether there is a will and where to find it. You could also contact your parent’s bank, in case the will is in a safe deposit box there.
- Contact Estate Attorney: If your parents had an estate plan, their attorney will direct you on how to transfer assets and assist with probate issues.
- Make a list of bills: As you go through your parent’s home, be sure to gather documents from every possible expense that may need to be paid or canceled, including utility bills and credit cards. If there are debts, alert the executor of the will. This is the person who was chosen to handle all final affairs, including paying ongoing charges and canceling things like subscriptions and memberships.
- Contact banks and investment accounts: If your parent owned investments or other financial assets, they may have named “beneficiaries.” With proof of death, the custodian should transfer the accounts to the beneficiary. Certain bank accounts are also set up as “Payable on Death” or POD, which means the assets transfer directly to the beneficiary outside of the probate process.
- Settle debts: One hard aspect of managing a parent’s money is paying off debts. If your mom or dad had a loan with a spouse, the spouse may be responsible for the debt. Otherwise, the executor of the will is probably the person who will handle this.
If there is no will, the court will appoint an executor. Whatever the case, paying off debts is important for avoiding interest charges. This includes car loans, home loans, credit cards and medical debts.
Contact one of the 3 credit reporting agencies, Equifax, Experian, or TransUnion to notify them of the death. Notifying one of the companies will get the account flagged at all 3 credit bureaus so that no credit will be issued in your loved one’s name.
- Manage the home: If your parent lived alone, it can be difficult to decide what to do with their home. You could start by making a list of ongoing costs you’ll need to continue paying, including utilities, upkeep and taxes. It’s important that these bills get paid while you’re deciding to keep the home, rent it or sell it. In the meantime, the mortgage company or landlord can show you how to continue making payments.
- Pay your parent’s taxes: If possible, try to get ahead of taxes before they're due to avoid unnecessary headaches down the line.
- Medical records: Consider obtaining a copy of your parents’ medical records, as they may be source of knowledge and reference for the entire family.
In a time of grief and challenging emotions, having a simple financial checklist after a parent dies, along with the help of experts, may relieve some stress and worry just when you need it most. Many of these steps are also applicable to a parent moving into a long-term care facility.
Source: Fidelity Investments, Consumer Reports