Money Changes After a Death

When someone dies, money problems can arrive fast. The bank freezes their account, debit orders bounce, their salary stops, and creditors call. At the same time, people may pressure you for money or offer quick loans. If you feel panicked about money right now, you are not alone, and there are steps that help.

What is happening

Once a bank is told about a death, accounts in the deceased's name are usually frozen until the executor takes over. Money in those accounts becomes part of the estate. If you relied on that account for household costs, you may need to set up your own quickly.

Debts. The deceased's debts are paid from the estate, not by the family, unless you co-signed a loan or stood surety. Many loans and store accounts have credit life insurance that may settle the debt on death, so ask. Do not agree to pay the deceased's debts from your own money before getting advice.

Payouts. Different money comes from different places. Funeral policies usually pay quickly. Life policies with a named beneficiary pay directly to that person. Retirement fund death benefits are decided by the fund's trustees, who must consider everyone who depended on the member, so this can take several months. The UIF may pay a benefit to a surviving spouse, life partner or dependent children of someone who contributed. If the death was work related, a road accident or a crime, there may be other claims.

Grants and income. If the person received a SASSA grant, it stops. If they were the caregiver for a child receiving a grant, the new caregiver can apply for it. A surviving spouse or minor children may also have a claim for maintenance against the estate.

Grief and big sums of money are a risky mix. Put lump sums somewhere safe and wait before making large decisions.

Signs to notice

• The main earner in your home has died
• Your household account was in their name and is now frozen
• Creditors are calling you about their debts
• You are waiting for a pension or policy payout
• Relatives are asking for a share of any money
• You have never managed the household finances before

30-second self-check

Answer yes or no. Go with your first honest answer.

• Do you have less than one month of money for essentials right now?
• Are creditors asking you to pay the deceased's debts?
• Are you unsure which policies, funds and accounts the deceased had?
• Are you considering a loan to cover the funeral or household costs?
• Are family members pressuring you for money?
• Are you expecting a lump sum and unsure what to do with it?
• Are you worried about paying rent, bond or school fees in the next three months?

0-1 yes: Your finances are under some strain but manageable. Keep records and move step by step.
2-3 yes: Money pressure is building. Make a short-term budget and get free guidance this week.
4 or more yes: You are under serious money pressure. Please speak to an NCR-registered debt counsellor or FSCA-authorised adviser before signing anything.

What you can do next

• Today: Open or use an account in your own name for household money, and list the essential bills for the next month.
• This week: Contact each insurer, fund and the employer. Ask what they need and how long payment takes, and write down reference numbers.
• This month: Make a new budget based on the income you will actually have. Our Money hub has budget and debt tools.
• Tell creditors in writing that the person has died and give them the Master's reference or executor details. Do not pay from your own pocket without advice.
• Park any lump sum in a safe account and speak to an FSCA-authorised adviser before investing or lending it to family.

Your tool

After a Death Checklist - a step-by-step list of what to do in the first 7 days, 30 days and 6 months, including money, accounts, claims and grants.

When to get professional help

Get help if you are behind on essential bills, if creditors are pressuring you, if you are about to receive a large sum, or if family conflict about money is growing. Also get support if money worry is making it hard to sleep or grieve.
Who can help: FSCA-authorised financial planner, NCR-registered debt counsellor, money coach, estates attorney, tax practitioner, FSCA-authorised insurance adviser

Getting help in South Africa

Check any debt counsellor's registration with the National Credit Regulator (ncr.org.za), and any adviser's authorisation with the FSCA (fsca.co.za). UIF claims go through the Department of Employment and Labour (labour.gov.za). SASSA (sassa.gov.za) handles grant changes. SARS (sars.gov.za) must be told about the death. If a policy claim is rejected, the Ombudsman for Long-term Insurance and the Pension Funds Adjudicator deal with complaints. The Cleared Mind 24-hour Careline on 0800 212 146 can support you emotionally.