Estate administration involves managing a deceased person’s assets, settling their liabilities and carrying out their wishes. However, this task can come with its fair share of challenges, which require careful planning and consideration.
Understanding common estate administration challenges will help you prepare and potentially avoid complications.
1. Identifying and settling financial liabilities
One of the first steps in estate administration is settling outstanding accounts. This includes costs such as mortgages and loans. You may not have a clear understanding of the deceased’s financial situation. This makes it difficult to identify and settle these liabilities. Evaluate all of the financial records, including bank statements and incoming invoices. Use that information as you craft a comprehensive debt settlement plan.
2. Addressing digital assets
Statistics show that the average person under 70 years old has over 160 digital accounts. Cryptocurrencies, online accounts and intellectual property pose unique challenges for estate administration. Keep records of all digital assets, including any instructions for their handling. Be mindful of privacy and security concerns with these accounts as well.
3. Managing unforeseen contingencies
Executors may encounter a variety of unexpected contingencies during estate administration. Hidden assets, outstanding legal issues and creditor disputes might derail the administration process. Be prepared for the unexpected so that you can address any challenges that might arise.
Most people perceive estate administration as a simple, straightforward process. The complexities of the challenges you might face can lead to questions, confusion and delays. Consider means for mitigating these complications as you prepare to handle a loved one’s estate.