Your Complete Financial Checklist for When a Parent Passes Away

Losing a loved one is always difficult, and the death of a parent can be particularly unsettling. Many people describe the loss of their parents as being orphaned: No matter how old you are or how well established in your life, this major loss will lead you to reevaluate your place in the world.

In addition to strong feelings of grief, losing a parent also means dealing with a mountain of paperwork. As an heir to their estate, you’ll be left to sort out their finances, put their affairs in order, and complete any final wishes about the things they’ve left behind.

From requesting death certificates to preparing a final tax return, there’s a lot to keep track of — it’s completely natural to feel overwhelmed. To help you sort through all the paperwork and keep things organized, we’ve put together this checklist to walk you through the major steps of handling your parent’s finances.

Get Copies of the Will

It’s best to have the will as early as possible, especially if there are instructions about funeral arrangements included in it. This will help you planning your parent’s final resting place and will be necessary for appropriately dividing the estate among heirs in the coming weeks and months.

Gather Identifying Documents

As you deal with various financial entities, you’ll need to prove your parent’s identity. To do this, you will need:

  • Birth certificates (for your parent and their children)
  • Social Security cards
  • Marriage certificates
  • Divorce paperwork
  • Military discharge papers

You may need some or all of these identifying documents for your other deceased parent and any of your parent’s heirs as well.

Get Copies of the Death Certificate

Most people are surprised at how many copies they will need of the death certificate to send to various financial institutions. Many experts recommend ordering up to 20 copies so you’ll have what you need and avoid the hassle of having to order more. You can usually order these from the funeral director or from your local Board of Health.

Inform Your Parent’s Employer

If your parent was still working, contact human resources to inform them of their death. Ask for information about benefits, which may include additional life insurance, health insurance, and retirement plan information.

Inform the Social Security Office

If your parent received Social Security, you’ll need to call to let them know your parent has died. They can help you switch payments to a surviving spouse if necessary and let you know if you or anyone else is eligible for a death benefit.

Inform the Veteran’s Administration

If your parent was a veteran, the VA may offer special funeral arrangements and other benefits, including survivor benefits.

Start the Probate Process

Having your parent’s will is only the first step to dividing their estate. Though a surviving spouse will typically get everything upon the death of one parent, when both are gone, you’ll have to go through probate court to authenticate the will and officially divide the estate’s assets. Each state has different rules and regulations, so working with a lawyer is a good idea.

Tip: If you are named the executor of the estate in the will, keep receipts for your related expenses so you can be reimbursed from the estate.

Settle a Living Trust

If your parent created a living trust instead of a will, you will be able to avoid probate court to divide the assets. Instead, the designated trustee (which could be you, a relative, or a third party) will settle the estate. This involves gathering all the trust’s assets, paying off any bills or debts, and dividing what’s left among the named beneficiaries of the trust.

Gather Financial Paperwork

To resolve your parent’s finances—whether they had a will or a trust—you’ll need information on all their accounts. These may include:

  • Bank accounts, such as checking and savings accounts
  • IRAs
  • Pension account information
  • 401(k) or 403(b) retirement plans
  • Annuities
  • Brokerage investment accounts
  • Life insurance policies
  • Deeds for other property and assets, such

You’ll also need to gather information about accounts to which they owe money. These may include:

  • Tax returns
  • Mortgage statements
  • Other loans, including student loans, home equity lines of credit, car loans, etc.
  • Utility bills for items like cable, electricity, gas or fuel oil, etc.
  • Credit card statements

Tip: If you aren’t sure that you know about all of your parent’s accounts, check their mail for the next three to six months to intercept bills and paperwork. You may find it easier to have their mail forwarded to you for convenience.

File a Final Tax Return With the IRS

You will need to file a final tax return for your deceased parent. Keep all of the paperwork you’ve gathered handy for filling that next April, and be on the lookout for W-2 forms and any final tax documents as they become available in January so you can file accurately.

Make Necessary Cancellations

Use the paperwork you’ve gathered as a guide to help you cancel accounts that are no longer necessary. These may include:

  • Credit cards
  • Lines of credit
  • Health insurance
  • Auto insurance
  • Voter registration
  • Memberships to clubs, subscriptions, etc.
  • Driver’s license
  • Email, social media, and other online accounts

Change or Close Accounts

If you have a surviving parent, you may need to transfer utility bills, mortgage accounts, and other property, assets and bills into their name. Review the financial documents to determine which payments still need to be made and arrange for them to be paid without interruption.

If you do not have a surviving parent, learn how to close accounts that are no longer needed and how to set up payment for debts that must be cleared.

File Claims for Benefits

You’ll need to file a claim to receive life insurance benefits if your parent had a policy. Likewise, you may be eligible for benefits from their retirement accounts, depending on their designated beneficiaries. A professional financial planner can help you file these claims and make the most of these benefits.

Get Professional Help

Depending on the complexity of your parent’s finances, dealing with their final affairs can be a major challenge. A good probate lawyer and knowledgeable financial planner will help you sort through the details and ensure that you don’t miss anything as you complete this process. They will also advocate for you as you work through this difficult process.

If you need help getting your own finances in order, we can help. Reach out any time for advice on how to handle your finances and plan your estate — a gift of peace of mind for yourself and your future heirs in their time of need.