Advice on financial affairs related to a parent's death.
August 17, 2022 10:50 AM
My father is in hospice and is in his last, I dunno, days or hours of his life. What do I need to do with respect to his finances and/or "estate?" Do I have to legally establish an "estate?"
I really wish there was a class you could take on the logistics of a loved one dying. But at least there's AskMe.
So here's the deal with my dad:
1. He has no assets, quite literally: no car, no house, at this point no belongings of any import. A very small, teeny-tiny IRA has been liquidated for funeral costs.
2. He receives social security, and a private sector pension through his former employer. His monthly income is about $2,400
3. Currently, my mom receives half of his pension and is the recipient of his life insurance payout upon his passing. (They are divorced.)
4. His share of his hospice stay (after Medi-Cal) is about $6,000 total.
5. He has about $5,000 other debt (credit cards only).
This is the entirety of everything I know about his financial house. A good friend's father recently died, and he said that their family had to legally create an "estate" for his father, so that debt collectors knew where to come to recover debts. But his sister did that work, so he didn't know much more about it.
Do I have to do any of that shit or can I just let the big multinational vulturecorp figure out the posthumous details of their contract with this man on their own? Is there anything else I should be doing with respect to finances? My major concern is minimizing any chance that anyone comes after me or any of my siblings for any of his debt. (My understanding is that they can't, but that they very well may, and so we have to know that they can't.)
One other thing I'd love to know is whether there's a general law that says whether my mother continues to receive her portion of his pension, or whether that's case by case.
This is California USA FWIW.
Thanks, and keep your people close while you have them.
I really wish there was a class you could take on the logistics of a loved one dying. But at least there's AskMe.
So here's the deal with my dad:
1. He has no assets, quite literally: no car, no house, at this point no belongings of any import. A very small, teeny-tiny IRA has been liquidated for funeral costs.
2. He receives social security, and a private sector pension through his former employer. His monthly income is about $2,400
3. Currently, my mom receives half of his pension and is the recipient of his life insurance payout upon his passing. (They are divorced.)
4. His share of his hospice stay (after Medi-Cal) is about $6,000 total.
5. He has about $5,000 other debt (credit cards only).
This is the entirety of everything I know about his financial house. A good friend's father recently died, and he said that their family had to legally create an "estate" for his father, so that debt collectors knew where to come to recover debts. But his sister did that work, so he didn't know much more about it.
Do I have to do any of that shit or can I just let the big multinational vulturecorp figure out the posthumous details of their contract with this man on their own? Is there anything else I should be doing with respect to finances? My major concern is minimizing any chance that anyone comes after me or any of my siblings for any of his debt. (My understanding is that they can't, but that they very well may, and so we have to know that they can't.)
One other thing I'd love to know is whether there's a general law that says whether my mother continues to receive her portion of his pension, or whether that's case by case.
This is California USA FWIW.
Thanks, and keep your people close while you have them.
brainwane put up a post last month on a free "workbook on the kind of bullshit you need to do when someone you love dies." I hope it is helpful. (The comments also are a good resource.)
posted by virago at 11:41 AM on August 17, 2022
posted by virago at 11:41 AM on August 17, 2022
I'm so sorry that you're in this situation and for your impending loss.
My mom died without a will in PA, USA almost four years ago and I knew nothing about this then but plenty about it now. Unfortunately, it's not as easy as "I'll just sit here and wait for someone to bother me about this." In PA, at least, yes, you have to legally file to have an estate created in the deceased's name. My mom was in a pretty similar state as your dad when she passed – no house, no car, about $10k in the bank that was recently inherited from her father and mostly used for funeral costs, and debt. In PA, at least, an estate needs to be set up if there is anything to deal with money/debt wise, even if it's very little. By the time that we used cash for the funeral and headstone, there was only about $2k left, but my sister and I couldn't even touch it until the estate had been formally closed. It's a multi-step process and none of it is particularly difficult, but it does require paying attention to paperwork and timelines and keeping very good records.
Every state and event county is different, but the tl;dr is to Google around for what you need to do for your jurisdiction.
My major concern is minimizing any chance that anyone comes after me or any of my siblings for any of his debt. (My understanding is that they can't, but that they very well may, and so we have to know that they can't.)
You're correct that they cannot but you're also correct that they will try. In the first six months after my mom died her debtors called me regularly, asking if she had any other assets that I still needed to liquidate and could give to them for payment. Eventually the calls stopped and they gave up.
One other thing that most people don't know: you'll need to file taxes for the deceased person for the year that they died. I did it easily by myself but it was still annoying to have to do.
posted by anotheraccount at 11:47 AM on August 17, 2022
My mom died without a will in PA, USA almost four years ago and I knew nothing about this then but plenty about it now. Unfortunately, it's not as easy as "I'll just sit here and wait for someone to bother me about this." In PA, at least, yes, you have to legally file to have an estate created in the deceased's name. My mom was in a pretty similar state as your dad when she passed – no house, no car, about $10k in the bank that was recently inherited from her father and mostly used for funeral costs, and debt. In PA, at least, an estate needs to be set up if there is anything to deal with money/debt wise, even if it's very little. By the time that we used cash for the funeral and headstone, there was only about $2k left, but my sister and I couldn't even touch it until the estate had been formally closed. It's a multi-step process and none of it is particularly difficult, but it does require paying attention to paperwork and timelines and keeping very good records.
Every state and event county is different, but the tl;dr is to Google around for what you need to do for your jurisdiction.
My major concern is minimizing any chance that anyone comes after me or any of my siblings for any of his debt. (My understanding is that they can't, but that they very well may, and so we have to know that they can't.)
You're correct that they cannot but you're also correct that they will try. In the first six months after my mom died her debtors called me regularly, asking if she had any other assets that I still needed to liquidate and could give to them for payment. Eventually the calls stopped and they gave up.
One other thing that most people don't know: you'll need to file taxes for the deceased person for the year that they died. I did it easily by myself but it was still annoying to have to do.
posted by anotheraccount at 11:47 AM on August 17, 2022
My major concern is minimizing any chance that anyone comes after me or any of my siblings for any of his debt. (My understanding is that they can't, but that they very well may, and so we have to know that they can't.)
This is correct, but you do have to pay what you can from the assets of the "estate," whatever they may be. It would be worthwhile to contact an attorney, privately or via a local legal aid org, to see what you're on the hook for. It will be a mild headache, but it's doable and necessary.
You may also get bills and collection notices from entities you've never heard of--don't pay a single bill out of your own pocket, don't respond, and Google the name of the org sending you these urgent collection notices. 100% of these mailers, in my experience, are scams and/or illegal attempts to collect debts. They are predatory as fuck, and if you give them the time of day they'll never leave you alone.
posted by knotty knots at 11:53 AM on August 17, 2022
This is correct, but you do have to pay what you can from the assets of the "estate," whatever they may be. It would be worthwhile to contact an attorney, privately or via a local legal aid org, to see what you're on the hook for. It will be a mild headache, but it's doable and necessary.
You may also get bills and collection notices from entities you've never heard of--don't pay a single bill out of your own pocket, don't respond, and Google the name of the org sending you these urgent collection notices. 100% of these mailers, in my experience, are scams and/or illegal attempts to collect debts. They are predatory as fuck, and if you give them the time of day they'll never leave you alone.
posted by knotty knots at 11:53 AM on August 17, 2022
Also, I'm sorry for your loss. It seems messed-up that one would be thrust into a challenging legal/financial situation amid an acute period of grief.
posted by knotty knots at 11:55 AM on August 17, 2022
posted by knotty knots at 11:55 AM on August 17, 2022
I don't know all the answers to the questions you posted above, and I'm very sorry for your loss and for having this dumped on you to sort out in your grief.
One piece of advice is to ask the funeral director for multiple death certificates, like 6 or 8, since you will need an original certificate for every single entity you or your mother deal with. Another point which might be relevant is that if your dad dies intestate (without a will) his estate must go through probate. In PA, at least, the state takes a bigger cut in taxes than if there is a will. Not sure about California.
The pension is probably already set up to either continue after his death (my mom, divorced from my dad, got a larger share after his death. This had been set up in the divorce settlement, but the survivors benefit itself had been set up when my dad retired.) I believe most pensions have a survivor's benefit, but this might vary, and contacting the previous employer or pension administrator (with a death certificate) can help answer this question. They will probably only speak to your mother about the specifics.
The kind of attorney who can help you with this is called an estate or trusts attorney. You might check with a local Bar association to see if there are low-cost or pro bono attorneys who might be able to help you.
posted by citygirl at 12:02 PM on August 17, 2022
One piece of advice is to ask the funeral director for multiple death certificates, like 6 or 8, since you will need an original certificate for every single entity you or your mother deal with. Another point which might be relevant is that if your dad dies intestate (without a will) his estate must go through probate. In PA, at least, the state takes a bigger cut in taxes than if there is a will. Not sure about California.
The pension is probably already set up to either continue after his death (my mom, divorced from my dad, got a larger share after his death. This had been set up in the divorce settlement, but the survivors benefit itself had been set up when my dad retired.) I believe most pensions have a survivor's benefit, but this might vary, and contacting the previous employer or pension administrator (with a death certificate) can help answer this question. They will probably only speak to your mother about the specifics.
The kind of attorney who can help you with this is called an estate or trusts attorney. You might check with a local Bar association to see if there are low-cost or pro bono attorneys who might be able to help you.
posted by citygirl at 12:02 PM on August 17, 2022
I am not a California lawyer, this is not legal advice: Wills, Estates, and Probate
posted by praemunire at 12:25 PM on August 17, 2022
posted by praemunire at 12:25 PM on August 17, 2022
I'm so very sorry - this is a difficult time to have to deal with bureaucracy. Very good advice upthread, especially about getting multiple death certificates (not copies). Get many more than you think you need. Hugs.
posted by sundrop at 1:34 PM on August 17, 2022
posted by sundrop at 1:34 PM on August 17, 2022
Most states have a special process for small estates that allow executors to settle out debts, payoff and close accounts, and receive money. This bypasses the primary estate process and should save you a lot of time. I was an executor and used this process and it worked well for the most part. The most trouble I had was with depositing a few small checks I received that were not made out to the estate. I was eventually able to get them deposited but a joint checking account with the deceased would have made it a lot easier.
posted by scantee at 1:53 PM on August 17, 2022
posted by scantee at 1:53 PM on August 17, 2022
The Executive's Guide, from Nolo Press was helpful to me.
posted by JimN2TAW at 2:29 PM on August 17, 2022
posted by JimN2TAW at 2:29 PM on August 17, 2022
The Executive's Guide, from Nolo Press was helpful to me.
posted by JimN2TAW at 5:29 PM on August 17 [+] [!]
D'oh! Executor's Guide.
posted by JimN2TAW at 6:05 PM on August 17, 2022
posted by JimN2TAW at 5:29 PM on August 17 [+] [!]
D'oh! Executor's Guide.
posted by JimN2TAW at 6:05 PM on August 17, 2022
The Executive's Guide, from Nolo Press was helpful to me.
The typo made me smile, but this is exactly what I was going to recommend as well. This is a helpful resource that has enough to get you started and through the process.
I am guessing that if your jurisdiction has a "small estate" option, this would apply to your situation, but all depends on the details. Also, depending on how long they were married, your mother may be entitled to survivor's benefits, as well.
Good luck -- it is a needlessly difficult process but it can be navigated.
posted by Dip Flash at 8:39 PM on August 18, 2022
The typo made me smile, but this is exactly what I was going to recommend as well. This is a helpful resource that has enough to get you started and through the process.
I am guessing that if your jurisdiction has a "small estate" option, this would apply to your situation, but all depends on the details. Also, depending on how long they were married, your mother may be entitled to survivor's benefits, as well.
Good luck -- it is a needlessly difficult process but it can be navigated.
posted by Dip Flash at 8:39 PM on August 18, 2022
This thread is closed to new comments.
posted by mezzanayne at 11:26 AM on August 17, 2022