If you need to speak to a lawyer about a deceased estate, give our Bare Law team a call on 1800 959 371 or head to our Estate Services to learn more.
Losing a loved one can bring up an overwhelming force of emotions, and handling their affairs, including their bank account, can add an extra layer of stress when you are already grief-stricken.
Knowing and understanding this process may help reduce some of that stress and make things a little easier. Keep reading to learn more about what happens to a person’s bank account when they pass away.
What happens to a person’s bank accounts when they die in Australia?
When someone dies, the executor of their estate will need to notify the bank of the passing. The bank will freeze their accounts where they were the sole account holder. This is to prevent further transactions and ensure the estate is protected.
If the deceased had a joint bank account with another person, these accounts will not be frozen and stay open as normal. If the account required signatures from both people to make actions, it will now only require the one signature.
Paying for expenses after the death.
Even if accounts are frozen, the bank will allow the executor to withdraw funds to pay for a funeral.
The executor will need to complete paperwork for the bank, as well as provide them with some documents, including the deceased person’s death certificate, their current Will, and the deeds of any trusts they held, plus a grant of probate or letters of administration.
Once the bank has verified the executor’s authorisation to access the deceased’s bank account, the executor will be able to pay off any debts. This could include credit cards or personal loans, and any credits will be paid out to their nominated beneficiaries in their Will.
If the deceased did not have a valid Will in place, ownership of the account and any estate assets and debts will be transferred to the Next of Kin or estate administrator and the accounts will be closed.
How long does it take for beneficiaries to receive their inheritance?
The process of administering an estate can be lengthy, and may take many months. Beneficiaries are entitled to receive their inheritance within 12 months of the deceased’s passing. If there is a delay in receiving the inheritance, the executor must provide a reason for this.
Final thoughts of deceased bank accounts and beneficiaries.
There are a few ways to ensure your family are taken care of in the event of your passing, so they can stress less on the financials and focus on their grief.
The first is setting up a Bare Prepaid Funeral. Organising your farewell in advance can save your family thousands of dollars in the long run, plus the stress of planning a funeral. Click here to read about the benefits of a prepaid funeral.
The second is ensuring your Will is valid, and you have nominated beneficiaries to your estate. Without a valid Will, your loved ones may experience a lengthy and stressful process through the courts. If you haven’t written your Will, click the link below.
This article is not legal advice. You should speak with your solicitor or accountant for specific advice on your personal or financial situation.