How to Add Up a Deceased Loved One’s Assets and Debts


Attorney, distinguished law professor

It is difficult when a loved one dies, with no set timelines to heal and deal with the resulting grief. Unfortunately, the law does not wait for family members to grieve the loss of their loved one before the deceased’s assets must be collected and debts must be paid.

Collecting a deceased loved one’s assets and debts is normally the responsibility of the executor of the decedent’s estate. If you are charged with that duty, there are several steps you must take to be sure your loved one’s estate is appropriately valued and accounted for. Here are six steps to take when adding up your loved one’s assets and debts: 

Step 1: Identify all assets

Settling a decedent’s estate requires two primary objectives: paying debts and distributing assets. In order to accomplish these tasks and close out the decedent’s estate, the executor must first identify all of the assets that the decedent owned when they died. This will be important for valuing the estate, calculating taxes, and determining what property is available for distribution to beneficiaries named in the decedent’s last will and testament.

Not all of the property that the decedent owns at death will be part of the decedent’s probate estate (the property that goes through the probate process and is administered by the probate court). That said, the executor must account for all of the assets in which the decedent held an interest when they died.

Some of the deceased’s assets will pass automatically to joint owners of the property, such as a joint bank account. Even so, the executor must account for this property.

Here are the types of assets that the executor must identify when adding up a loved one’s assets in their estate:

» MORE: A will is only the first step. Get all of the documents you need.

Real property

One of the most valuable assets that a decedent may own when they die may be land or real property. Real property will be part of the decedent’s probate estate but it must be probated in the state in which the property is located.

Life insurance

If the decedent held any life insurance policies, the executor should identify these. Life insurance policies are considered “payable on death” assets, which means they are not part of the decedent’s probate estate. As a result, they are paid directly to the beneficiary named on the policy. The executor should identify these assets to be distributed, even if they are not explicitly stated on the will.

Bank accounts

Other assets the executor should identify and account for are any bank accounts that the decedent owned at death. If the accounts were jointly owned with someone else, the assets in the account may pass directly to the joint owner. However, if the accounts were owned solely by the decedent, these assets will be part of the decedent’s estate that must be accounted for in probate.

Pensions and retirement accounts

A decedent’s employment pensions and other retirement savings accounts also must be accounted for. Although these also may be paid directly to the named beneficiaries of the accounts, the executor must identify any accounts that are available to be paid out. Often there will be questions of valuation that the executor may have to address on behalf of the estate. 

Other financial accounts or portfolios

Also included in the decedent’s estate may be other accounts holding stocks, bonds, certificates or other financial investments. These may be part of the estate to be distributed through probate.

Personal property

Much of the property that a person owns when they die consists of miscellaneous personal property that is collected during life. This includes things like:

  • Furniture
  • Cars
  • Boats
  • Collectibles
  • All tangible items of property in the decedent’s home or storage
» MORE: Planning a funeral? Get access to discounts in minutes.

Digital assets

In today’s digital world, many of a person’s assets are identified as “digital” assets. These can include any property, accounts or subscriptions that are administered, managed or accessed online or stored electronically, such as:

  • Social media accounts like Facebook, Instagram, Twitter 
  • Online financial accounts
  • Photos stored on a computer or cell phone
  • Videos
  • PowerPoints
  • Word documents
  • Spreadsheets
  • Audio recordings
  • PDF documents
  • Other computer files

These kinds of assets may not necessarily hold much financial value, but they are still assets that others may have a right to access and, therefore, the executor must identify and account for. 

Step 2: Identify all debts

In addition to the assets that the executor must identify, the executor also must identify all of the debts that the decedent owed when they died. Debts are considered assets of the estate that simply have negative value. Paying the outstanding debts of the decedent is a primary responsibility for the executor. When identifying the debts of the estate, the executor should account for the following:


Probably the largest debts that the estate will have to pay are taxes. These could include both federal and state taxes. These must be paid from the estate before any distributions of property are made. Often, the executor will have to sell assets to be able to pay for the taxes that are owed. If the assets in the estate are insufficient for paying all of the taxes, there may be no assets left to distribute.

Funeral and burial expenses

The cost incurred for the deceased’s burial and funeral expenses are usually paid out of the estate. After taxes, these expenses must be paid before any property is distributed. 

Medical bills

If the decedent has outstanding medical bills, the estate may be responsible for paying these bills before distributing property to beneficiaries. This is also the case if they spent time in the hospital or long-term care facility immediately before their death. 

Credit card debt

Other than taxes, the most common debt that people die with is credit card debt. Unfortunately, credit card bills do not simply disappear when someone dies. The decedent’s estate becomes responsible for paying this debt out of the money that is left in the estate. The executor is responsible for notifying any creditors that may be owed money and has a specific amount of time in which to give notice, depending on the specific laws of the state.

» MORE: Planning doesn't have to be complicated or expensive. Join the peace of mind movement.

Student loans

The executor should account for any student loans that the decedent may have owed. This may include PLUS loans that a parent may have cosigned for a child. Although these loans are usually forgiven when a student or cosigning parent dies, they are still debts that the executor should account for when adding up a loved one’s assets and debts.  

Step 3: Value all assets and debts

Once the executor identifies all the assets and debts that the decedent owned when they died, these assets and debts must be valued so that appropriate taxes may be calculated. Also, beneficiaries of any assets may question the value of the property they are to receive. There are several options for valuing assets of the estate.

Most assets of the estate may have a set value. For example, if the decedent owned an individual bank account that had $1,000 in it when they died, assuming the account is not accessed or used by anyone else, that account is easily valued at $1,000 since it is not likely to change between the date of death and the date of distribution. However, other assets may change in value during this time and may raise a question over when to value the assets. 

Often, assets of the estate will be valued as of the date of the decedent’s death. The executor also may have the option of valuing assets six months after the date of death. However, if any assets are sold during this time period, the executor may have to determine the fair market value of an asset for purposes of taxes.

Some property may be valued as of the date it is sold to determine the fair market value. However, other types of property may be more difficult to value, such as art work or business interests. This type of property may have to be appraised by a professional to determine the true value of the asset.

Step 4: Pay all debts

Once an executor identifies and values all of the assets and debts, they can then pay all of the outstanding debts that have to be paid, including taxes. Creditors that have asserted a proper claim against the estate also can be paid. Part of the debts paid include fees that may be charged for the services of the executor, attorneys, accountants, and other professionals needed for the proper administration of the estate.

Keep in mind that some debts associated with assets that are distributed to named beneficiaries may run with the assets. This means, for example, that if a beneficiary is to inherit a car from the estate, if the car has an outstanding loan associated with it, the beneficiary of the car may be responsible for paying the outstanding loan on the car in order to receive the car.

Often, the decedent can indicate in the will whether the beneficiary of a particular asset will be responsible for the associated debt. In this case, they can decide for the estate to pay the debt and the beneficiary may receive the asset free and clear of any debt. The same may be true for a mortgage running with a home or real property, for example.

Step 5: Distribute all assets

Once all of the debts of the estate are paid, the remaining assets may be distributed to the appropriate beneficiaries named in the will or any heirs who have a right to inherit property from the estate. When all debts are paid and all assets are distributed to the appropriate beneficiaries, the executor may make an accounting to the probate court and the court may close the estate.

Adding Up Assets and Debts To Close a Loved One’s Estate

When you are grieving the loss of a loved one, the last thing you want to do is worry about money, personal property, and bills. But adding up the assets and debts that a loved one leaves behind is an integral part of properly administering your loved one’s estate.

Seeing that their estate is managed appropriately after their death is a crucial part of addressing a loved one’s legacy. It is not only a required task for paying taxes and settling debts with creditors, it is also an important way to honor your loved one’s final wishes.  


Icons sourced from FlatIcon.