Dealing with a death in the family is stressful. But, when it comes to handling the financial burden of the funeral and other expenses, the already sad situation can seem unbearable. Here are some helpful tips you can employ to make your financial burden easier to handle so you can focus on the process of grieving when a loved one dies.
Look Into Their Insurance
Many people don’t realize how many different types of insurance can include death benefits. Traditionally, life insurance was the primary form of insurance that was utilized to pay for funeral expenses. Now, funeral expenses tend to be looped in with many other types of insurance including car insurance, home insurance, loan insurance, accidental death and even credit cards. Look into your loved one’s various insurances to discover which ones can and will cover funeral costs.
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Do You Need Professional Assistance?
Depending on how much estate planning the deceased did before their death will determine whether you need to hire a probate attorney or not. If you arrange your affairs so that everything is held in “Joint Custody” there is nothing to pass through probate and so an attorney isn’t necessary. According to an article by Nolo Press Will You Need to Hire a Probate Lawyer? “Under current law, more than 99.7% of all estates don’t owe federal estate tax, so you probably don’t need to worry about that… If, however, your initial investigation reveals that there may not be enough money in the estate to pay debts and taxes, don’t pay any bills before you get legal advice. State law gives some creditors priority over others.”
Not all people have insurance that will cover the costs of their funeral expenses. When this happens, there are some forms of financial assistance you can seek out. It’s best to talk to those at the hospital, care facility, and funeral home to discover what your options are. You may be surprised at the various financial assistance options that are available once you ask for them. You can also save money by going through your local “Cremation Society” which often has reduced rates for Cremations and Funerals.
Social Security Benefits
If your loved one had social security benefits, then it’s likely that you can receive some form of compensation to put towards the funeral expenses. Depending on the specific situation, social security may pay out a lump sum of money to help with the funeral expenses or they may pay an ongoing monthly survivor benefit. Talking with a local social security representative can help you to understand more about what you can receive in your specific situation.
Coping with the death of a loved one is hard enough on its own. Having to handle the financial burden that goes along with it can be extremely challenging. The above are some ways that you can successfully deal with the financial burden of a loved one’s death. You may find that you will need to utilize a combination of options to cover all or most of the funeral expenses for your loved one. The more options you have, the lesser your financial burden will be.
How to Deal with Debts of the Deceased
The Federal Trade Commission (FTC) has established guidelines on how a debt collector can deal with relatives of the deceased regarding unpaid bills. In most circumstances, relatives are not responsible for debts contracted by the deceased, unless someone actually “co-signed” for the debt. The deceased’s estate, however, will be responsible for those debts and they must be paid before any inheritance can be paid out (this is handled through the probate process). Insurance proceeds can be paid directly to the beneficiary and not to the estate if the policy is set up that way in advance. Most funeral homes require payment (or a signed contract) with someone other than the deceased to ensure that they get paid and are not dealing with probate.
Get Multiple Copies of the Death Certificate
While planning the funeral be sure to get multiple copies of the death certificate. You will probably need one copy for each financial institution the deceased dealt with. So if he/she had a bank account with two separate banks, a brokerage account, an IRA and an insurance policy you will need at least 5 copies of the death certificate. And a Xerox copy is not acceptable! When they say “copy” they really mean multiple official originals. This is typically handled by the funeral home relatively inexpensively. It’s easiest to get these copies when the funeral home is dealing with the funeral arrangements If you wait until months afterward, these death certificates can be much harder to get and will cost you more money, so get more copies than you think you will need.
Brooke Chaplan is a freelance writer and blogger. She lives and works out of her home in Los Lunas, New Mexico. She loves the outdoors and spends most of her time hiking, biking, and gardening. For more information, contact Brooke via Facebook at facebook.com/brooke.chaplan or Twitter @BrookeChaplan
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