Does Debt Follow The Death Of A Parent with Schraeder Law, LLC

Debt doesn’t simply disappear when someone dies. If you’re concerned that your parents’ debt might outlive them, consider talking to an estate planning attorney like Larae Schraeder from Schraeder Law, LLC, our guest on this episode.

She's a listener favorite, so we had to bring her back!

After we saw an article on a website called “Nerdwallet” about the responsibilities adult children may face if their parent dies with financial debt. We immediately thought of our guest, Larae Schraeder, as the expert we needed to address the subject.

Get ready for another fact-filled episode, including...

Life transitions – how to be prepared ahead of time

• Having the “conversation” with parents on death issues before they are unable to do so
• How to explain the complexity of wills, etc.  Difference between wills/trusts/estates
• Documents: healthcare power of attorney, power of attorney, estate documentation, financial accounts

How to stay on top of parents’ needs

• Make sure they are not creating unnecessary debt
• Make sure they are paying bills, keeping track of paperwork, paying taxes, etc.
• How to ensure that the decision-makers (e.g., executor) will have the best interest in the parent/older adult in mind as they discuss issues with them.  And how to ensure other family members are in agreement/understanding and kept in the loop
• Mediation options when family members disagree or the older individual is at risk

When are children responsible for the parental debt?

• Are there different types of debt – some must be paid, others not?
• Does the estate change because of the debt (e.g., reducing the estate)
• What is paid first?  (e.g., federal taxes, Medicaid, etc.)
• How are homes/dwellings dealt with?  Cars, property, etc.?
• Does the size of the estate change the outcome?

Resources available both locally and to a wider audience

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Copyright 2026 Carol Ventresca and Brett Johnson