Fran Hughes: Five steps to navigating the heartache and administrative burden of burying a loved one

Losing a loved one can be a difficult and overwhelming time, especially when you’re responsible for their financial affairs.

My dad recently passed away, leaving behind an estate that had 18 beneficiaries which included his grandchildren and my mum.

For others who find themselves as executors for the first time, Liz O’Sullivan from Leach Legal suggests outlining tasks to be done in a chronological order and methodically attending to each.

“It is also important for a smooth administration process to keep beneficiaries notified of the progress of the estate and to seek professional assistance from a lawyer or accountant if you are finding it too onerous or difficult,” Ms O’Sullivan said.

Here’s a guide to managing deceased estates.

Notify relevant service providers

An individual may have a range of service providers -- anything from bank accounts, mobile phone plans, superannuation funds to Services Australia payments. Start by making a list of providers. Pay close attention to ongoing subscriptions charged against bank accounts or credit cards. Upon their death, notify each service provider of their passing, including the cancellation of driver’s license. A death certificate can be provided at a later stage.

Banks have a deceased estate department that can assist. However, when someone passes, they can only share information about the account with the estate executor, administrator or next of kin. Ensure you have a copy of the will or grant of probate. This will also allow the banks to release funds for funeral and estate expenses, and help the executor set up an “estate of the late” account.

Arranging the funeral

The executor is responsible for making the funeral arrangements and following any directions left by the will maker as to the funeral arrangements but is not bound to do so.

Things to consider include whether the body is to be buried or cremated. If the body is to be buried, where? If the body is to be cremated, whether will the ashes be scattered or retained? There is also the nature and format of the funeral service, and who they should notify about the service.

Funeral directors provide a full service including notice of death, notice of funeral and applying for the death certificate.

Seek professional advice

Seek the advice of estate planning professionals such as a legal practitioner, accountants and financial advisers. The insight and guidance of a subject matter expert can go a long way to giving you comfort and assistance in supporting you with managing the process.

Legal practitioners can guide you through the steps of applying for probate, legal documents or notifying beneficiaries. Accountants can assist with the tax implications of disposing assets to beneficiaries, applying for an estate tax file number or preparing a tax return for the estate. Financial advisers attend to share registry transfers, insurance payouts and superannuation payments.

Grant of probate

A grant of probate is a document issued by the Supreme Court. It confirms that a will is valid and gives the executors the authority to act. Probate is necessary to give the executor the right to deal with certain assets such as real estate and money in bank accounts. Real estate cannot be transferred unless probate is obtained (except to a surviving joint proprietor).

Once probate is granted, redeem and collect assets, pay debts and liabilities, wait for the expiry of the six-month limitation period for family provision claims against the estate and defend the will against a challenge if it arises.

Prepare estate accounts showing all money collected and paid on behalf of the estate, attend to reimbursement of expenses incurred on behalf of the estate, and distribute estate to beneficiaries in accordance with the terms of the will.

Reading the will

It is not usual to have a formal reading of the will. Usually the beneficiaries are notified of their interest by the executor or the firm of solicitors appointed by the executor. This can often be a very emotional and confusing time for beneficiaries and open, honest and regular communication with beneficiaries is often the best way to minimise any difficulties that may arise. Failing to be open and honest in dealing with beneficiaries can lead to distrust and conflict later.

An executor may instruct their lawyers to notify the beneficiaries of their entitlement and where necessary, communicate with beneficiaries as to the progress of the administration of the estate. Alternatively, they may choose to do so themselves.

Fran Hughes is a certified financial planner and head of financial solutions at Nexia Perth www.nexia.com.au