Your debts do not disappear when you die. Instead, they become part of your estate. Your estate includes the total value of all your assets at the time of your death.

Before your heirs can receive any assets, your debts must be settled. Other people are typically not liable for your debts.

Debt order

Debts and expenses must be paid in a specific order. Typically, funeral expenses and taxes are paid first, followed by secured debts (such as mortgages) and then unsecured debts (such as credit card bills). Some assets, like life insurance and retirement accounts, may be protected from creditors.

Not enough money

If your estate does not have enough assets to cover all debts, it is considered insolvent. Debts are paid in a specific order, and some creditors may not receive full or partial payment.

Co-signed loans

If someone co-signed a loan with you, they will still be responsible for the debt.

Surviving spouses

Surviving spouses are responsible for debts they co-signed or borrowed jointly. They may also be responsible for debts related to family expenses, such as medical bills, funeral costs, clothing, jewelry, rent, and childcare.

👉 Learn more about surviving spouses' responsibilities.

Medicaid

If you had Medicaid, the state may seek reimbursement for medical costs from your estate.