Steps you must take when someone dies

Locate important papers

HELP's checklist enumerates all the paperwork you'll need to track down, including wills, trusts, insurance policies, investment accounts, business and partnership arrangements, credit card statements and other evidence of assets and liabilities. Unless your parent had a large or complicated estate, you probably can take your time pulling this information together.

However, if your parent owned a business or was in the midst of a complicated transaction -- selling a home, for example, or setting up an estate-planning trust -- you may need to work more quickly. If your parent had financial advisers -- accountants, attorneys, real estate agents, insurance agents -- it's smart to contact them and ask if any matters need to be taken care of immediately.

Who's in charge here?

Usually, one person supervises the tasks of settling an estate. If your parent had a will or a trust, it should specify who is to serve as the executor or personal representative (or, in the case of a living trust, the successor trustee). The person named is responsible for making sure creditors are paid, assets are distributed and estate tax returns are filed. This is usually the person who will investigate what benefits or insurance proceeds, if any, are owed to the heirs.

If your parent died without a will or trust, the laws of your state typically indicate who's in charge: usually a surviving spouse, if there is one, or an adult child or parent. A court hearing will be held to appoint someone, and there could be a battle if more than one person wants the role, said attorney Denis Clifford, co-author of “Plan Your Estate,” a legal self-help guide published by Nolo Press. That's why it's so important to have a will or trust, since such court proceedings are a time-consuming and unnecessary expense.

If you are the person selected and don't feel up to the task, you can always decline. But remember that you are allowed to hire professional help for the work ahead -- and that if you proceed, you probably should.

Get some help

Questions will come with even the simplest estate, Long said, so it's smart to hire someone who understands the process and can give you good advice.

An accountant may be all you need for a smaller estate, although you'll probably also require an attorney if your parents' assets were worth $500,000 or more.

“You've got to contact someone knowledgeable for help with pulling it all together,” Long said. Even if your parent didn't own or owe much, “you need someone to hold your hand a little bit.”

An accountant, for example, can help put together the financial snapshot of assets and liabilities that's needed when settling an estate and offer advice about the tax consequences of transferring assets.

An attorney is all but required if your parent's estate was large enough to incur taxes or if your parent left a lot of debt. Deciding which creditors should be paid, and when, can be one of the trickier parts of settling an estate.

Liz Pulliam Weston is the Web's most-read personal-finance writer. She is the author of several books, most recently "Your Credit Score: Your Money & What's at Stake." Weston's award-winning columns appear every Monday and Thursday, exclusively on MSN Money. She also answers reader questions on the Your Money message board.

Updated June 16, 2009

< previous |  1 | 2 |