When a loved one passes away, managing their financial affairs may not be top of mind, but it should be at the top of your To Do list. Staying on top of bills and expenses associated with the deceased’s estate is critical, but it can also be complex. How do you navigate handling these remaining financial obligations? How do you pay the bills of an estate?
Step 1: Gather Documents
Start by gathering relevant financial documents and bills. This may include bank statements, brokerage account statements, credit card statements, utility bills, mortgage statements, insurance policies or other financial records. Organize and review these documents to get a comprehensive snapshot of the estate’s financial status and obligations. Check bank and credit card statements for any recurring payments that may need to be made or changed.
Step 2: Notify Creditors
Notify all relevant creditors and service providers of the death. Usually this is done by speaking to a company representative and sending them a copy of the death certificate. Sometimes creditors may require additional documentation; it’s important to keep a record of all communication and correspondence to verify these requirements have been met.
Step 3: Open an Estate Checking Account
Establishing a checking account in the name of the estate allows you to use it for depositing incoming funds and paying the estate’s bills. Even though the deceased is no longer here, they may still receive income, insurance proceeds or tax refunds. By keeping the estate’s finances separate from your own, you can maintain accurate records and simplify the accounting process.
Step 4: Pay Expenses
Once you have created a list of the estate’s assets and what bills and expenses need to be paid. The Colorado Probate Code contains a statute that outlines the priority in which claims should be paid.
Step 5: Consider Professional Assistance
Managing the financial aspects of an estate can be overwhelming, especially at an already difficult time. A Colorado probate lawyer can help you analyze and advise you regarding the correct order in which to pay any claims against the estate. If you are unfamiliar with the process or would just appreciate guidance through the complexities, call the lawyers at Brown Law Firm, LLC at (303) 339-3750.