We receive this call often: “My spouse just passed away. What do I do now?”
During this understandably difficult, jarring time for the person calling, we help them get organized, and stabilized, in the following areas:
When did the spouse pass away? If it’s very recent, the caller is likely to be in the midst of grief, and maybe even shock. It’s important that no critical decisions are made, as they are likely to be hurried, and potentially regretted in the future. What takes precedence at this time is that the caller is taking care of their mental health by allowing themselves space to grieve, surrounding themselves with a circle of support, and otherwise taking things slowly.
So our first step is to ensure that our client’s mental health is getting the attention it deserves during this time.
Next, we want to ensure that our client can handle their day to day needs. Do they have access to the marital bank account? Do they have access to online banking and bill payment accounts? Do the right institutions (bank, mortgage company, credit cards) know that the spouse has passed? Most importantly, are there things that need to be paid for the minor children of the marriage (e.g. school, health insurance, etc.)?
If our client is struggling with any of the above, we’ll find a way to help if we can, or at least point them in the right direction. This step adds stability to our clients’ lives during a very unsteady time, and it can serve to eliminate at least one source of stress and anxiety.
Video: Dave explains how legal health is assessed after the death of a spouse.
Moving on, after discussing our client’s mental and financial health, we’ll turn to the legal matters that may need to be attended to. The first step is to re-visit the estate planning documents that are in place (e.g. Living Trust, Will, etc.) and determine whether any immediate administrative actions are required: some trusts are drafted to require distributions upon the death of the first spouse. We won’t distribute just yet, but we will want to start formulating a plan for when the time comes to distribute.
Next, we’ll talk about creditors and any other potential liabilities that may need to be addressed. We won’t pay liabilities just yet either, but again, it’s about formulating a plan and creating stability and predictability for our client.
Finally, once we have a good sense of the steps required legally after the death of the first spouse, we’ll begin implementing our plan. This could take any number of forms, including routine filings with the recorder’s office for real estate owned by the deceased spouse, to a full-blown trust administration or probate administration if there were substantial assets owned by the deceased spouse at the time of death that didn’t automatically pass to the surviving spouse.
Because there are numerous factors involved after the death of a spouse, it’s important that clients are properly counseled during this critical, and extremely difficult, season of their lives, and we appreciate the opportunity to serve that role in our clients’ lives.