A new report looking into probate and estate administration has concluded that one in seven people have ‘secret assets’ they take to the grave.
The first annual Bereavement Index from probate firm Exizent found that 14% of probate cases featured so-called secret assets, where not all of the deceased’s accounts and financial assets were known about at the start of the discovery process.
In 20% of probate cases, no assets were known about at the start of the process.
Overall, the study found that 37% of financial accounts are discovered during the probate process.
One significant factor behind these secret assets being taken to the grave was the failure to pass on financial information to loved ones.
60% of legal professionals said that fewer than half of their clients have all of their financial affairs in order when they die.
Given that the vast majority of solicitors rely on the knowledge of the executor and the documentation they provide to verify assets and liabilities, this risks a lot of money going missing forever during probate.
The study also found that 33% of people dealing with probate admit to knowing ‘absolutely nothing’ about the process before they started, with only 4% claiming to know a lot about probate before getting started.
15% of executors learn about their assigned role after someone has died, but more than a third of us will act as executor of someone’s will at some point in the future.
Probate is often a slow and inefficient process. However, not knowing the full financial affairs of the deceased inevitably slows down the process even further.
On average, it takes around 5 months to complete probate. The study found that it took longer than a year to complete, in 9% of cases.
More than half of those who had recently dealt with probate admitted it took longer than expected, and in 25% of probate cases the process was delayed.
At what is likely to already be a challenging time for families, adding delays or challenges around financial information will only make the process more difficult for those involved.
87% reported finding the probate process stressful, with 20% of those finding it extremely stressful.
James Armstrong, who lost his wife, father-in-law and both parents within six years, said:
“Organising the financial affairs of a close family member who has passed away is extremely upsetting. You are already grieving, meaning your emotions are all over the place, so the last thing you need is a complicated legal process to exacerbate things. But sadly, that is exactly what happens.”
One factor behind probate delays is waiting for responses from financial institutions, with 78% of legal professionals saying this factor causes delays. Better communication would no doubt help, along with an easier discovery process and better technology.
Nick Cousins, Founder and CEO of Exizent said:
“Death is a difficult time for everyone. And sadly, as we have discovered in our report, the processes that come with it can be lengthy, repetitive, and complicated, dragging things out for everyone involved. At an already challenging time, handling estates administration is an added burden for the bereaved, with legal professionals themselves admitting that the probate process is not fit for purpose.
“We believe estates administration should be simpler, and that modern technology solutions can make this a reality. We are also pushing for ‘open finance’ for the deceased to make asset discovery much easier, because - as our research shows - this is a major cause of stress and delay.
“We want to make it easier for legal services firms and institutions to work together to sort out what is so badly needed to ease the burden on the bereaved.”