When a family member passes away, survivors must make financial decisions while in a period of grief and possible state of shock. Steps need to be taken to protect financial interests and make sound decisions.

Those left behind are able to deal with the loss far more easily when steps have been taken to prepare for this event. Important information has been recorded that will be needed and the information has been stored in a safe place. The documents range from social security numbers, birth/marriage certificates, tax information and wills, to investments, annuities, bank accounts, pensions, and life insurance policies.

Rule #1- Do not feel pressured to make long-term financial decisions while under stress.

If large sums of money are involved, consult professional financial advisers, lawyers, and accountants that you trust. If a large lump sum payment is received from a source, consider placing it into a safe investment until a clear plan of investment is decided. A safe investment may be short-term certificates of deposit (CD's) or a money market savings account. Many con artists attempt to prey upon people at this time.

If money is owed by the deceased loved one, do not be pressured into paying immediately. These debts will be paid by the estate, after a clear financial picture becomes available. It is not your personal obligation. Being slow to act on spending decisions helps stop people from taking advantage of you at a stressful time.

The executor of the estate should be someone trusted who has a good working knowledge of financial affairs. If you are named as executor and do not possess adequate knowledge, ask your accountant or a trusted advisor to help you. Paying for a few hours of their time can save huge sums if you avoid costly mistakes.

One of the first steps involved after the death of a loved one is to consult the family attorney. This person has knowledge of these situations and can provide guidance. If a family attorney is not available, consider contacting your county services department for guidance.

If the loved one is a veteran, contact the veteran's administration for any assistance it provides. Some of the benefits may include participation in the funeral service or a burial plot in a national cemetery.

Transfer all legal documents into a survivor's name. The legal documents include auto titles, house deeds, bank accounts, and credit cards. Accounts such as IRA's and 401K's may also need to be changed. If a spouse is the beneficiary, in many cases they may be rolled over into a similar account. If others are the beneficiaries, things may become more complicated. Consult a trusted advisor.

Contact the loved one's place of business and find out if the company's benefits include any sort of bereavement counseling. The company's human resources department may have financial assistance or counseling available. Plus the survivors may have money coming to them from unused vacation time, sick leave, etc.

Immediate concerns:

Medical Insurance: If the family's medical coverage will no longer be in effect, a federal program called COBRA may be useful. COBRA is available to the family if the deceased's employer has at least 20 workers. A family may continue medical insurance through COBRA for up to 36 months. The premiums are high, but probably have more comprehensive coverage than other medical insurance policies. The main point with continuation of coverage is avoiding the immediate need to search for a policy or prove insurability.

Immediate Financial Needs: Try not to cash in investments that have penalties for early withdrawal. Start with savings accounts and then choose other investments to liquidate based on a logical timetable, taking maturities into account.

Spouse in need of Care: If a surviving spouse is elderly and in need of care, contact a professional to seek advice. Difficult decisions must be faced and there are local agencies available in most areas to offer guidance. The agencies may be state, county, or organizations created with a religious or charitable philosophy.

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