What happens to someone’s bank accounts after they die?

The short answer

When a bank is told that a customer has died, it freezes that person’s individual accounts — including transaction accounts, term deposits, credit cards and loans. The money is then dealt with through the estate: usually an executor (if there is a will) or an administrator (if there is not) obtains the authority to act, transfers the funds into an estate account, and distributes them according to the will or the intestacy rules. Joint accounts, and small estates, have simpler paths in some situations.

Tell the bank as soon as possible

Banks do not necessarily know that a customer has died, so it is important to notify them promptly. Anyone can notify the bank, but in practice this usually falls to the next of kin or the estate representatives. The bank may ask for identification from the person notifying it, as well as a copy of the death certificate.

Who can deal with the accounts

A bank can take instructions about a deceased person’s accounts only from someone authorised to act on behalf of the estate. The bank’s duty of confidence to its customer does not end with death — so next of kin and beneficiaries generally cannot give instructions to the bank, or require it to share information about the accounts.

The usual legal process is to obtain probate (where there is a will) or letters of administration (where there is not) from the High Court. That grant is what authorises the executor or administrator to deal with the deceased’s property, including their bank accounts.

How the process usually works

Once the executor or administrator has the grant, the typical steps are:

• open an account in the name of “the estate of [deceased’s name]”;
• transfer the funds from the deceased’s accounts into the estate account;
• close the deceased’s individual accounts;
• pay the estate’s debts and expenses; and
• distribute the remaining funds according to the will (or the intestacy rules), then close the estate account.

Small estates — under $40,000

If the estate is worth less than $40,000, the bank may be able to forward money from the deceased’s accounts to a person as set out in section 65 of the Administration Act 1969 — without the full probate or administration process. The bank must be satisfied that the person has died and that no application has been made to the High Court to administer the estate. It will usually want to see the death certificate and information about the person receiving the money.

Even then, the person receiving the money may not automatically be entitled to information about the deceased’s accounts, and may need letters of administration to access that information.

Joint accounts

If the deceased had a joint personal account, the account will usually be transferred into the remaining account holder’s name (or names). This step can be more complicated if there is debt attached to the account — particularly a loan secured by a mortgage over a property.

Signing authorities and powers of attorney

When a customer dies, all signing authorities on their accounts — and any power of attorney authority — come to an end. A signing authority lets someone operate an account in another person’s name without owning the funds; a power of attorney is a wider power to act on someone’s behalf. Neither continues after death.

Complaints about the accounts

The Banking Ombudsman can generally look at complaints only from people who received the financial service involved. After probate or letters of administration are granted, the executor or administrator can complain on the deceased’s behalf. The Ombudsman will usually not consider complaints from next of kin or beneficiaries while those documents are pending or have not been sought — though in limited circumstances it may consider a complaint for an estate worth less than $40,000 where no grant was made.

Practical steps for families

If someone close to you has died:

• notify their bank as soon as possible;
• obtain copies of the death certificate;
• find the will (if any) and check who the executor is;
• if there is no will, get advice about who should apply for letters of administration;
• understand that the process takes time — accounts stay frozen while the estate is dealt with; and
• talk to the bank and a lawyer before making any decisions about the accounts.

Where to get help

Useful public resources include:

• What to do when someone dies — the New Zealand Government’s key steps after a death;
• Wills, probate and estates — how an executor or administrator is appointed; and
• Community Law — guidance for families and whānau, including practical support.

This guide is based on the Banking Ombudsman’s guide to deceased customers’ accounts (updated October 2025).

The bottom line

Bank accounts are frozen on death, and the money is released through the estate process — usually by an executor or administrator acting with a grant from the High Court. Notify the bank early, understand that confidentiality continues after death, and get advice about the right path for the estate.