My partner just died. What do I need to do?

My partner just died. What do I need to do?

As a surviving spouse or partner, you’ll face many personal and financial challenges in the following months and there are many things you’ll need to do to settle your loved one’s “estate.” Your initial emotions of grief and confusion may make it difficult to focus on what steps you need to take to make sure your partner’s will is filed properly and final bills and taxes are paid.

Hopefully, this article will help you better understand what it is you need to do and the order in which it should be done:

Gather the documents. If your deceased partner/spouse ran the household finances, it would be great if s/he left behind an organized filing system as well as all the passwords you need to access computer files. But if you need to dig through the piles yourself, start a filing system using colored manila folders. Among the headings: banking, bills, credit-card statements, taxes, life insurance policies and estate documents.
Gather Social Security numbers, birth and marriage certificates, military discharge papers, company benefits booklets, car titles, powers of attorney, and current statements for bank, brokerage and retirement accounts. Get 10 to 25 copies of your spouse/partner’s death certificate. The funeral director can help with this. Many financial institutions require a death certificate to close an account or to change ownership of investments. You’ll also need the certificate to transfer title on real estate and to claim life insurance and veterans benefits.
Make sure to pay your bills for credit cards, utilities, car loans, property tax, insurance premiums and the mortgage. You could incur late charges if you let these tasks slide. (If you are hit with such charges, ask for a waiver due to the circumstances.)
Notify Medicare and other health insurance companies that you will no longer pay your spouse’s premiums. Also cancel club memberships and magazine subscriptions that you don’t need. Explain the situation and you may get a partial refund.
Keep a joint checking account for at least a year. Occasionally, odd checks to the deceased spouse/partner come in. If you close or retitle the account, there won’t be a place to put them.
If you need help, get it. If the estate is large, you may want to create a “financial support team” that includes an accountant, a financial planner, and a trusted friend or family member who has good financial skills. In the first six months, you’re in a state of shock. Your team can help you when you’re least able to attend to details.
Assess your cash flow. While you should postpone big financial decisions, you should take stock quickly of your expenses and income. Make a list of your income sources: Social Security, pension payments, dividends, interest, job earnings and IRA distributions.
Write down your fixed expenses, such as groceries, mortgage payments, utilities and insurance. Look at your checkbook to see if there are recurring payments on your credit card. Make a separate list for your discretionary costs, such as gift s and travel. If you are short on cash, start chipping away on the discretionary spending.
Collect life insurance benefits. If you can’t find the life insurance policy and you don’t have an agent, go through checkbook registers and canceled checks to see if there were any checks written to an insurance company. When you file a claim, you may have choices regarding how you will receive the money. Read the fine print carefully. In some cases, an insurance company will place your funds into its own money-market funds and send you a checkbook. Turn down this option, and then place the money in a federally insured bank account or a money-market fund. If you’re instead considering guaranteed monthly payments for life, seek the advice of your financial adviser.
You have nine months from the date of your spouse/partner’s death to file a federal estate-tax return. Some states have earlier deadlines for filing returns for state estate and inheritance taxes.
Save all receipts related to the estate, especially if the estate’s value is close to or exceeds the estate-tax exemption.
Assuming you had named your partner/spouse to make financial and health-care decisions on your behalf in the event you became incapacitated, you will need to designate a new agent for your financial power of attorney, health-care power of attorney and health-care directive.
Check with the employer. If your spouse/partner was employed at the time of her/his death, call the benefits administrator to ask about benefits due to you. Besides life insurance, these can include unpaid salary and bonuses, accrued vacation and sick pay, left over funds in a medical flexible spending account, and stock options.
You’ll also need to check on pension benefits. Assuming your spouse/partner was retired and you were both receiving monthly pension benefits in the form of a joint and survivor annuity, notify the plan administrator immediately. Depending on the type of annuity you chose, you could be due 50%, 75% or 100% of what both of you were receiving before your spouse/partner died.
If your spouse had a 401(k) and you were legally married, it makes the most sense to roll the account into an IRA. If your spouse still had accounts from former employers, consolidate them into one IRA. The custodial firm that holds your IRA can help with the paperwork. The 401(k)-to-IRA rollover can be dicey. Ask the 401(k) administrator to make a direct transfer to the IRA. If the plan instead sends you a check, get it into the IRA within 60 days. If you miss the 60-day cutoff, the IRS will consider the money to be a withdrawal and you will pay tax on the entire amount.
If you were receiving health coverage under your spouse/partner’s employer plan, you may be able to continue on the group plan for 36 months through COBRA coverage. (An employer with fewer than 20 employees is not required to provide COBRA coverage.) Ask the plan administrator if the company will continue picking up the employer’s premium subsidy.
Again, if you were legally married, roll over an IRA. If you are the only beneficiary of your spouse’s IRA, you can roll the retirement plan into your own IRA tax-free. (There are other steps you must take if you are one of several beneficiaries.) Before doing so, make sure your spouse, if s/he was 70 1/2 or older, took her/his required minimum distribution before s/he died. If s/he didn’t, you must take her/his RMD by December 31 in the year s/he died or pay a penalty. In the following years, after you’ve rolled the plan into your own IRA, you can skip distributions until you’re 70 1/2, allowing the account to grow tax-free. Once you turn 70 1/2, your required distributions will be based on your life expectancy. It may be wise to forgo a rollover if you’re younger than 59 1/2 and need to tap the account. By leaving the account in your spouse’s name and remaining as a “beneficiary,” you will not pay a 10% penalty on any withdrawals. After you turn 59 1/2, you can roll the account into your own. If your spouse left you a Roth IRA, you can claim the Roth IRA as your own, in which case distributions are never required during your lifetime.
If you were legally married, claim a Social Security benefit. A widow or widower is entitled to a survivor benefit that is equal to 100% of the deceased spouse’s benefit, as long as the survivor waits until full retirement age to collect. You can collect a survivor benefit as early as 60, but your benefit will be permanently reduced a bit for each month you claim before your full retirement age. (It’s reduced by 28.5% if you claim at 60.) If you were collecting a spousal benefit, you can “step up” to a survivor benefit. At that point, the spousal benefit will disappear. If you are younger than full retirement age and decide to wait to claim the full survivor benefit, you will stop receiving the spousal benefit. If your spouse dies before claiming a benefit, you will be eligible for a survivor benefit equal to the benefit s/he was entitled to at the time of her/his death.
During this difficult time, you’ll also want to stay in close touch with friends and family members and accept their support and assistance. Websites, and local support groups are also available to help you cope with your recent widow(er)hood.

After you have taken these steps to settle your partner/spouse’s affairs, you will need to review your own legal documents. If you have a will, you probably need to get it updated to reflect the death of your spouse/partner. You’ll also need to have documents rewritten, such as a power of attorney, letter of instruction, or living will.

To update your will or trust package, click this link.