Credit Card Debt Dies with You

by KYW's Amy Feldman

Many of us have received calls from credit card companies offering debt protection in the event of death.  For a fee, we can make sure that if we die, our credit card balance will be expunged and won't be passed on.  Should you get it?

Companies offering debt protection in the event of death fail to mention this: You can't inherit debt - at least not directly.  Your kids will not be sent to the workhouse to pay off your frivolous purchases like groceries.  That said, the executor of your estate is required to post a death notice so creditors can make their claims.  The estate you pass on to your beneficiaries will be reduced by the amount of your debts.  But if your assets don't cover your liabilities your beneficiaries are not obligated to pay off excess debt--regardless of what unscrupulous debt collectors may tell unsuspecting grieving widows.  While you may be morally swayed into clearing your loved one's name by those collectors, you may not be obligated to do so.  Knowing your rights may be the best protection of all.