Making Cents:

A NEIGHBOUR of mine died suddenly last month. And unfortunately, it isn’t the first time in recent years where I’ve known someone or someone’s partner who passed away without any warning signs.

From a financial perspective, trying to make sense of what needs to be done or where you even need to start can be very difficult for those left behind, which is why getting the help of a financial adviser and/or a family member or a friend is important.

They can help make sense of what your loved one had in place, from life assurance polices to investments to pensions to debt.
And with all of that in mind, I’ve put together what I believe are the f first five steps that should be taken in the aftermath of a loved one’s death.

Gather important documents
You need to gather things like life assurance policies, a copy of a will if one was made, bank statements, pension documents, loan agreements etc. And when you’ve gathered them all together, you should make contact with your solicitor, financial advisor or bank official to see what your next steps are.

Everything owned by a person who has died is known as their estate, and that can be made up of savings, investments, life assurance policies, shares, property and so on.

The person dealing with the estate of the deceased is called the executor and they are named in a will as the person responsible for dealing with the affairs of the deceased. They apply to have authority to deal with the estate and this is where they obtain a grant of probate.

And if no will has been made, or the executors named in the will don’t want to deal with the estate, an administrator is nominated and they apply for what’s called letters of administration before they can deal with the estate.

Before you get to that stage, you may need the help of a trusted friend or family member to help and support you because trying to find and make sense of pensions and mortgages and wills or no wills can be difficult.

You may need someone who can ask questions on your behalf, and who can listen and understand what a solicitor, bank official or person from The Department of Social Welfare is telling you, and what needs to be done next and why.

Contact the life assurance company and the administrators of their pension scheme
If your spouse/relative had a life policy and you are the beneficiary then you need to contact the life company straight away and find out what needs to be done to get the proceeds from the policy.

At a minimum any life company will require the completion of a claim form, the policy document/certificate and they’re going to require a death certificate, to prove your spouse/relative is deceased.

And if the deceased had the foresight to leave such a life policy, they did so because they didn’t want you to suffer financially if they were not around. And for some people, especially in the short term, the proceeds from a life assurance policy could constitute the bulk of their income, so finding out what needs to be done and acting on it without delay is very important.

In relation to pensions, you need to contact the administrators of the pension scheme your spouse/relative were members of and this information and contact details should be on any recent correspondence they may have filed away. The rules governing occupational and personal pensions vary with the different pension arrangements so find out which one applies to you and what you are entitled to.

And don’t think they just have one pension they may have several that you just don’t know about.

And if they were self-employed don’t think they never had a pension either, they may well have.

I remember dealing with a very good friend of mine a couple of years ago whose husband had passed away nearly eight years previously and only when we were talking about pensions for her, did he come up, and she wondered why he never started a pension. But after not much investigation on my part, we discovered he did, and we reunited her with the €34,763 he had in it.

Apply for any benefits you may be entitled to
If your spouse/relative dies and they were already in receipt of certain social welfare payments, you can continue to receive this payment for six weeks following their death, provided they included a payment for you. And even if you were in receipt of a separate payment in your own right i.e. state pension, you will get theirs for six weeks as well.

You could also be entitled to a widow(er)’s contributory pension, provided you or your deceased spouse had enough PRSI contributions.

The Department of Social Protection can also provide certain once off payments to help out families and their community welfare officer is generally the go to person when instances like this arise.

There is a once off payment in the amount of €8,000 which is known as the widowed or surviving civil partner grant, and certain conditions have to be met before this is awarded, and there is a funeral grant available as well in the amount of €850 and again certain conditions have to be first met before this amount is given.

Whatever your circumstances are you should contact your local Social Welfare Office and let them know first of all that your spouse/relative has died and then ask what you might be entitled to and how you go about making a claim for whatever you are.

Make adjustments to your monthly budget
Have a look at your monthly outgoings and see first if there were any organisations or clubs that your spouse/relative was a member of where the subscription to be a member of, was automatically deducted from your account each month or year. You should probably think about canceling these memberships and direct debit payments sooner rather than later.

And if it’s your spouse/partner who passed, you might be going from a two-income household to just one, or indeed you could be going from a situation where your deceased partner was the only person earning an income at the time of their date, so you really do need to sit down with someone to get a handle on what your monthly outgoings so you can make adjustments to reflect your new situation.

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This is not a nice exercise but an incredibly important one to get visibility around what you are up against. If you don’t you are prone to making rash, emotional and drastic decisions that they later regret.

Check for any remaining debt
The person who died may have had debts and if they did, you should notify their creditors of their passing. If someone dies owing debt, it doesn’t go away.

The deceased person's estate is responsible for paying any outstanding debt. And if there is not enough money to be collected to pay any outstanding debt, they will have to write that debt off i.e. they can’t recover it from anyone else, unless the debt is in joint names and the other person to the loan is alive.

If there is debt outstanding, you should ask the creditor whether the deceased had any life policy attached to the loan whereby it would clear the debt in the event of their debt.

Liam Croke is MD of Harmonics Financial Ltd, based in Plassey. He can be contacted at liam@harmonics.ie or www.harmonics.ie