The first few weeks after the loss of your husband are often a blur. Everything now can be categorized “before he died” and “after he died”. Time is passing but at the same time it is staying still. Guess what? The bills still have to be paid. This list is to get you through the task of bill paying and nothing more so you can go back to taking care of yourself.
Estate Checking Account
Typically, your husband’s estate should have its own checking account, in the name of the estate, with the estate’s federal tax identification number (not his social security number). Your attorney will help you obtain what is necessary. All estate expenses and debts should be paid from this one account. Any checks in his name only should be deposited into the estate account.
Record Keeping
It is very important for the Personal Representative (which may be you) of an estate to determine accurately what the debts are before dispensing money to a beneficiary or even paying any but the most essential bills. Paying some creditors and not paying others, which is giving some creditors “preference”, can open the Personal Representative to personal liability.
Keep a list of any income or dividend checks you receive, the date received, the amount of the check, and the payor. Very careful records must be kept of everything that comes into the estate and of all the expenses paid from the estate.
Debt and Bills: What Is Your Responsibility?
You are responsible to pay your own and your joint debts. Here is what you need to do. Gather up all the bills and divide them three ways:
- Your individual bills.
- Your husband’s individual bills.
- Bills in both names.
Debt owed by your husband becomes a claim against his estate after death. Therefore, you will pay your husband’s individual debts from the separate account set up in the name of the estate.
Should you receive a bill addressed to your husband that is not a familiar one, write the creditor asking for proof that it is a proper claim. Any bill that does not seem familiar, should not be paid. Refer anything peculiar to your attorney.
Please note: if you live in a “Community Property State”, such as Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin (applies in Alaska in certain circumstances), a husband and wife are each equally responsible for paying each other’s debts remaining after death as long as one of them acquired the bill during the marriage. It doesn’t matter whose name is on the bill.
To Do:
Pay the following bills in your name or joint name first:
- Mortgage payments
- Utilities
- Health Insurance
- Homeowners Insurance (if due)
- Auto loan payments
- Auto Insurance payments (if due – some are due every 6 mos instead of monthly)
Cash Reserves
Hopefully you will have an adequate cash reserve on hand so that you will have no trouble paying these bills. However, if you do not think you have enough money to pay all your bills during the estate settlement process, first speak with your attorney about an estate allowance (if there is liquid money available) that can be paid for family support. If that is not available, then it is best to write the creditors explaining your situation. Tell them you know that you owe them money and plan to pay it, but you will have to pay a lesser amount until you have a better picture of your total financial situation. Keep a copy of all letters sent.
If you are expecting to receive life insurance proceeds and do not have adequate cash on hand to pay your immediate bills, contact the life insurance company and explain your situation. Some companies will accelerate your claim or send you a partial amount more quickly to assist you with support.
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