Although a morbid issue to deal with, it is imperative to have a will in place just in case something unforeseen happens.

Most wills are relatively uncomplicated, with the spouse commonly appointed as the executor to deal with the estate. However, issues can arise if the spouse is not financially literate or has limited understanding of the deceased’s financial position.

The executor is also legally obliged to deal with the assets of the estate fairly and ensure that the distribution of assets occurs in accordance with the will.

That said, the administration required to deal with an estate is the last thing that a loved one or spouse wants to deal with, especially as they are grieving the loss at the same time.

Regardless, a number of areas require immediate attention at this time – bills need to be paid and living costs for the spouse continue as normal yet, if all the bank accounts are in the name of the deceased, the accounts are normally frozen by the bank. This means that any direct debits against that account will be stopped, no transfer of money can take place, and direct debit/credit cards are cancelled.

Working with your bank can sometimes prove difficult especially where affected family members do not have a relationship with a personal banker. The majority of Australian banks have a protocol of what must happen when someone dies, which often begins with family members advising the bank that a death has occurred. This may involve either contacting by phone or sending an email to a support services team. Banks will require documents such as a certified death certificate or, where someone is an executor, a certified copy of the will or grant of probate. In instances where the executor has multiple queries, they may be speaking to, or emailing, various bank personnel across numerous departments within the same bank trying to obtain access to accounts.

However, the good news is that any bank accounts in joint names will automatically revert to the survivor so you can still access and operate the account.

Joint home loans can also prove problematic. If the home loan is not going to be paid off with the deceased’s superannuation or life insurance, then the bank may be able to transfer the certificate of title to the surviving spouse once the estate is administered or, alternatively, once the loan is refinanced to the surviving spouse.

The above points are only the tip of the iceberg of financial issues that need to be considered to administer an estate properly. One way of removing the burden from the executor is to have a conversation with your accountant to see where they can assist – your accountant can help with understanding the financial issues, and possibly deal with the banking issues and paperwork required to administer the estate. They will also be able to assist with any tax issues associated with the disposal of assets.

This article first appeared in the Summer 2020/21 issue of Client Alert.