Having gone through something like this when my dad passed, I wanted to find ways to have my bills paid after I pass, so my siblings wouldn’t end up with a mess of unpaid bills because they have no access to my account. (that’s not exactly what happened with my dad, but I was shut out of his account for months - the bank wanted court documents even though I had been POA and was executor of the will. They wanted probate court docs, which took a long time).
I added one of my sisters as “joint owner with rights of survivorship” onto my checking account, so that if I’m incapacitated/passed, she can see that bills get paid. I thought it was all set, but then I spoke with another person at the bank who said that if I pass, the account is shut down, regardless of a joint owner. I called the main bank branch and asked, and they said that once the paperwork is received (death cert, etc), the account would be shut down and my sister can open a new account.
Is this really what happens? Is there a better way to arrange things in advance so that the electric, insurance, etc. doesn’t just get cancelled by default? I realized that if my internet gets cancelled, there goes my email, but I can move my bills to a web-based email.
Has anyone dealt with this type of issue, or have any insight?
Thanks!
Don’t know if I have foolproof insight, but here is what I did.
First, divide monthly bills into two categories: Essential and non essential.
Essentials are obvious: anything critical to the house and car: all insurances, utilities, trash, etc. I pay these with autopay to my CC. No matter what happens to me, these critical pills will be paid automatically until heirs sell the house. Heirs have full access to the bank and that CC the accounts so they can eventually cancel the.
I have created Virtual Card Numbers for non essentials: phones, subscriptions. virus software, MS360, etc. They are also configured for autopay, but I have full control over those VCN’s, and I set the expiration date just a few months out.
When those bills aredue, those VCN’s will expire on their own. Heirs don’t need to do anything.
There are several banks that issue VCN’s and I chose Citi for their simplicity.
I thought about that exact thing, robertpri, and I do have virtual crfedit cards through Privacy.com. The problem is – when you pass away, Social Security notifies banks and they shut down the accounts! I asked my bank if they would continue to pay for auto-pay and other bills (like VCC), and they said NO! The account gets closed when the primary owner passes away and any bills that come through get bounced, unpaid.
I had hoped to do the same thing – bill on my virtual credit card numbers, but they ultimately link to a bank, which pays the bill when it goes through.
Your heirs may well be locked out of the accounts the way I was. The bank won’t leave a deceased person’s account open! You might want to check on that. My bank won’t. My credit union won’t. My dad’s bank didn’t.
I went through this issue with my Dad — he had a Bank of America checking account and credit card. When he died, Social Security notified them and they closed the accounts–FAST. It wasn’t me that notified the bank! I couldn’t even pay my dad’s credit card bill – they wouldn’t send me a copy (I was POA and did his bills for years, but POA ends at death). I couldn’t pay for the funeral expenses from his money. Nothing.
I’m frustrated that even having a joint owner won’t keep the account open for bills to be paid !! I guess they only keep it open if the joint account is a spouse?
robertpri – like you, I have my essential bills on auto-pay (but with my checking account). My bank said that the auto-pays would bounce because the account will be closed.
I do have a couple of bills on a credit card (phones), but then the credit card won’t get paid from the bank!!! So that will start another mess…!
One thing I did do – I have an online bank account that is my “emergency savings” and designated my executor-siblings (primary and secondary) as beneficiaries. So that money should pay out quickly upon death – no probate, etc. So I’ll tell them that the $$ from that account is intended to pay bills – utilities property taxes, funeral, etc – they get the $$ quickly and can arrange payments without waiting for probate, and they can sell the house without having unpaid house bills.
I know I’m not the first person to deal with this issue, and I’ll bet that there are many families who have been slammed when this happened to them. So there must be a way…!
Let me know if you figure anything out!!
lisa5678 – I’m looking into that. Bank of America required court documents.
I’m not sure what my bank requires – all they said is that “there is a process”. I tried to ask more and the person said that I should contact a lawyer b/c bank employees can’t advise. I said I wasn’t asking for advice – I was asking about their procedure!!
I hope it will be that simple – that a death cert. would be enough since she is joint owner. But my experience with Bank of America has me double-checking, because it took months!
I’m reading up on trusts. That might be an easier solution.
So with a trust, the money, the house, etc. all skip probate?
That alone would be a good reason to have a trust…!!
So I found this article What Is A Trust And How Does It Work? | Bankrate
It says to figure out why you want the trust.
For me, it’s not about avoiding estate taxes, but about making things convenient for my siblings to deal with – and they are out-of-state – about 1 hour away, but still, dealing with all of the issues at a distance is a pain!
Most of my money accounts have beneficiaries, but the house and related bills are the hassle.
still researching…!
When wife was in a hospice and I was there all day, I mixed with others having family members in the hospice.
I was astounded at their conversations: “Where does grandma bank?” “Does she have a will?”
I vowed to never let that happen when I’m gone, so spent time creating a Trust, ensuring heirs are beneficaries to everything, and then most important, ensure heirs understand where the finances are located, and how to access them along with acct info, passwords, and contacts.
I have all of the banking/bill/account/password information printed and secured for my siblings, and a copy in my safe-deposit box and a copy for my executor. Those things can be done without a trust – it’s just a matter of listing and organizing information.
I’m just thinking more about the hassle of important bills going unpaid (with no access to my bank account). Plus my siblings live out-of-state, so stopping in at a bank, etc is not convenient for them.
Mine was written by a savvy Trust atty. I was concerned about the car, possessions, personal property, etc. He did not list them, but instead used blanket language, “all vehicles, possessions within the home, garage, etc”
Covered everything without making detailed lists, which would have to be constantly updated.
In a trust, it’s a good idea to consider designating percentages for cash gifts you want to leave your heirs, it saves updating and changes which costs attorney time (money.)
Siblings out of state? Is one of them your executor? Depending on the laws where you live, they might have to post a bond or get a state resident to be co-executor. The reason is your state probate court can’t serve them papers if they live out of state and have neglected their executor duties. This would not be needed if you have a trust.
Another advantage to a trust is that your successor trustee can take over for you if you become incapacitated before you die.
Often you have to get a companion will along with the trust, so that the will covers anything of yours that you didn’t mention in the trust and that doesn’t have the trust title, and those things would have to go thru probate.
I was successor trustee for my dad, executor for my mom, and co-administrator for my brother (I’m done, not doing another one!). All three were in different states, and I was out of state. I was able to settle all three, including filing tax returns, within a year. The probate process for my brother was amazingly easy, quick and cheaper than the other 2, and his estate included a house. My dad’s trust was easy because he gave me detailed instructions while he was still living, although the paperwork with Vanguard and Fidelity was more complicated than I thought it should be. Mom’s was annoying because her state required executors to hire a lawyer, and that was frustrating, although I negotiated a lower fee in advance and saved money.
Death certificates can usually be obtained in a week, but on rare occasions it takes longer. My sister-in-law waited 52 (fifty-two) days for her husband’s.
The best thing you can do for your executor & siblings is leave instructions, and downsize. They will thank you later.
What if you put all of your account access credentials in your Google account and then set it up for Inactive Account Management? This would allow your sister to gain access to these credentials if there has been no activity for 90 days (i believe). This is a form of “dead mans switch” that might be what you are looking for…