Death of family member offers financial lessons for Texans

Until death of a loved one occurs, the average American family just doesn’t want to think about it. When it inevitably darkens our door, we seek help from an estate planner.

In one family, the mother passed away after a long illness. The father had been diligently taking care of the financial matters accumulated in their twilight years. It took the gentleman about six months to finish the financial tasks and paper work settling his wife’s estate. He discovered the funeral home sends out a death notice to the Social Security Administration. This stops all social security checks. The SSA will send a death benefit check of $225, but you have to request it.

Filing for a lump sum benefit is fairly simple if one follows the steps. In this case, the husband went to his local SSA office and saw the lines extending twice around the building. Instead, he opted to call and was informed him it would be a 40-minute wait to speak to a live person. He waited and learned that he could file for the death benefit by mailing a copy of the death certificate, marriage license and his birth certificate to SSA. He could also set up an appointment and bring the documents into the office. He was in and out of the place in less than 30 minutes.

Another obstacle was with the car insurance. When the gentleman called to remove his wife’s name from the policy, the company tried to charge him $200. So, he got three new auto quotes and chose the lowest one. Don’t accept rate increases as a penalty for a death.

The third problem that arose was a credit card in the wife’s name. The husband had been an add-on account holder. Although the gentleman called the company to request having his wife’s name removed, the company canceled the card and turned it over to collection without providing the opportunity for payment.

The ensuing nightmare included recurring monthly charges and numerous collection agencies. According to one spokesperson for the American Collectors Association International, this is nothing new. The man asked for the bill, confirmed the charges and paid them.

There are some very simple procedures to follow if you plan accordingly for your distribution of assets, so your heirs won’t have to. The death of a loved one is never easy but there are ways to make the end of one’s financial path an easier one.

Source: Star-Telegram, “Mother’s death offers lessons for managing affairs after a loved one passes” Teresa McUsic, Jan. 10, 2014