What happens to money in a checking account when someone dies?
Asked by: Rebecca Schneider | Last update: January 30, 2026Score: 5/5 (25 votes)
When someone dies, their checking account is typically frozen, and ownership transfers to a joint owner, a named beneficiary (POD/TOD), or through probate to the estate, handled by an executor, requiring a death certificate for access by authorized parties like joint owners, beneficiaries, or executors to distribute funds according to a will or state law.
What happens if no beneficiary is named on a bank account?
If you don't have a beneficiary on your bank account, the funds typically go through probate, a court-supervised process that distributes assets according to your will, or state law (intestacy) if you have no will, which can be costly, time-consuming, and delay access for heirs. Without a designated Payable-on-Death (POD) or beneficiary, the money becomes part of your estate, potentially incurring legal fees and taking months or even years to resolve, instead of passing directly and quickly to your chosen individuals.
Can a beneficiary withdraw money from a deceased bank account?
Yes, a named beneficiary can withdraw money from a bank account after the owner's death, but they need the deceased's death certificate and their own ID to claim the funds, especially with Payable on Death (POD) or Transfer on Death (TOD) designations, which usually bypass probate. For joint accounts, the surviving owner typically retains full access, while for other accounts, the executor manages funds for the estate, paying debts first before distributing to beneficiaries.
How long does a bank hold a deceased person's money?
The bank account will be frozen until the probate process is complete.
What happens to money in a checking account when the owner dies?
If beneficiaries are named, funds will be made payable to the named beneficiaries on the account(s). If probate documents are presented, checks are made payable to the “Estate of” the deceased customer. If small estate documents are presented, checks are often issued in the name of the affiant or claimant.
What Happens to Bank Accounts After Death? - Knowledge from a Probate Attorney
Why shouldn't you always tell your bank when someone dies?
You shouldn't always tell the bank immediately because it can freeze accounts, blocking access for paying bills or managing estate funds, and potentially triggering complex legal/tax issues before you're ready, but you also risk problems like overpayment penalties if you wait too long to tell Social Security or pension providers; instead, gather documents, add joint signers if possible, and get professional advice to plan the notification strategically.
Who can withdraw money from a deceased person's account?
The nominee or legal heirs have to submit documents like the death certificate, residence proof, identification documents, and if required, legal heir certificates. This ensures money in the deceased's account is transferred to the legal beneficiary per the bank's rules and legal procedures.
What is the 40 day rule after death?
The "40-day rule after death" refers to traditions in many cultures and religions (especially Eastern Orthodox Christianity) where a mourning period of 40 days signifies the soul's journey, transformation, or waiting period before final judgment, often marked by prayers, special services, and specific mourning attire like black clothing, while other faiths, like Islam, view such commemorations as cultural innovations rather than religious requirements. These practices offer comfort, a structured way to grieve, and a sense of spiritual support for the deceased's soul.
How do banks know if someone is deceased?
The most common way banks find out is when family members contact them directly. Relatives can call or visit the bank to report the death and ask about next steps. The bank will typically request a death certificate and the deceased person's Social Security number to begin the process.
What not to do immediately after someone dies?
Immediately after someone dies, avoid making major financial decisions, distributing assets, canceling crucial services like utilities (until an attorney advises), or rushing significant funeral arrangements, as grief can cloud judgment; instead, focus on securing property, notifying close contacts, and seeking professional legal/financial advice to prevent costly mistakes and family conflict.
When should you notify the bank of death?
The deceased person is likely to have ongoing standing orders and direct debits, so it's best to notify these organisations of the death as soon as possible to avoid receiving letters demanding outstanding payments.
What are common executor mistakes?
Common executor mistakes include poor record-keeping, paying debts or distributing assets too early, failing to communicate with beneficiaries, commingling personal and estate funds, mismanaging assets, and delaying the probate process, all of which can lead to legal issues, personal liability, and family disputes. Executors often lack experience and try to handle everything themselves, overlooking the need for professionals like attorneys or CPAs to navigate complex tasks, tax filings, or proper asset valuation.
Do banks freeze bank accounts when someone dies?
In most cases, banks freeze accounts when they are notified of a person's death. Understanding how this process works will help families prepare for the steps in estate planning.
Who should never be named as a beneficiary?
Not all loved ones should receive an asset directly. These individuals include minors, individuals with specials needs, or individuals with an inability to manage assets or with creditor issues. Because children are not legally competent, they will not be able to claim the assets.
Can banks release funds without probate?
Some banks and building societies will release quite large amounts without the need for probate or letters of administration.
Can a regular checking account have a beneficiary?
Checking accounts can, and should, have beneficiaries. Naming one or more beneficiaries for your checking account, while it's not a requirement, can provide a quicker and smoother transfer of funds to your loved ones after you pass away.
Why not tell the bank when someone dies?
You shouldn't always tell the bank immediately because it can freeze accounts, blocking access for paying bills or managing estate funds, and potentially triggering complex legal/tax issues before you're ready, but you also risk problems like overpayment penalties if you wait too long to tell Social Security or pension providers; instead, gather documents, add joint signers if possible, and get professional advice to plan the notification strategically.
How long does it take to release funds from a deceased account?
Generally, collecting straightforward estate assets like bank account money will take between 3 to 6 weeks. However, there can be more complexities involved with shareholdings, property and some other assets, which can increase the amount time it takes before any inheritance is received.
How soon are banks notified of death?
When should I notify a bank after someone dies? The executor (or next of kin, if no executor has been appointed) should notify all banks and financial institutions of the person's death as soon as possible.
Why is the 9th day after death important?
According to Christian traditions, prayers help the soul of a loved one to leave the earth easily, as well as find their way in another world. On the 9th day there is a commemoration of the deceased, the prayer of his sins, as well as his blessing on the 40-day journey to Heaven.
Why did Jesus stay for 40 days after his death?
We aren't told, but a likely explanation is that he was using the forty days as a parallel to his time in the wilderness. Just as he spent forty days in the desert to prepare for his ministry, he now stayed with the apostles for forty days, preparing them for their ministry.
How many days after death should you have a funeral?
Average Time Between Death and Funeral
Most American funerals take place within one week or less from death. With the help of a funeral home, a week is typically enough time to make arrangements and contact loved ones. Historically, funerals had to take place after just a matter of days, because of decomposition.
How to avoid probate on bank accounts?
Bank accounts, like other assets, generally go through probate unless steps are taken to prevent it. Two common strategies to avoid probate on bank accounts include joint ownership and designating a beneficiary through Payable-on-Death (POD) or Transfer-on-Death (TOD) accounts.
Can an executor withdraw money from a deceased bank account?
Yes, an executor can withdraw money from a deceased person's bank account, but not immediately; they must first get legal authority from the probate court by presenting a certified death certificate and other documents, then get "Letters Testamentary" (or similar court order) to prove their executor status to the bank, at which point they can manage the account to pay debts and distribute assets as the will directs. Until then, the account is typically frozen, though joint owners or POD (Payable-on-Death) beneficiaries can access funds directly.
Does a will override a beneficiary on a bank account?
No, a beneficiary designation on a bank account (like Payable on Death or Transfer on Death) almost always overrides a conflicting will because it's a direct contract with the bank, bypassing probate and directly transferring funds to the named person. While a will distributes assets that go through probate, the beneficiary form dictates who gets the account funds, making it a more powerful tool for those specific accounts.