Financial Planning Steps after Losing a Spouse
Nothing can prepare you for losing your spouse. If you have recently been widowed, the world seems to demand rapid response to weighty decisions at every turn. Among the hardships of losing a spouse are legal decisions, financial pressures, and memorial arrangements to deal with, leaving you little time to grieve the loss of your loved one.
If you’ve been widowed, here are some helpful tips to help get you through this difficult time. You may be surprised to find out that not all financial decisions are as urgent as they seem.
Initial Period of Grief
Give yourself time
Grief is a biological process that affects your ability to make rational decisions. Therefore, it is important to note that many decisions regarding you and your family’s financial welfare – both large and small — can wait. We advise that those in mourning put off any financial decisions that can wait.
Take care of essentials and dependents
While holding off on long-term financial decisions that can wait, take that time to handle the essentials, such as making funeral arrangements, managing immediate expenses, and taking care of yourself and your dependents. It is important to have enough cash to make daily purchases and pay basic bills on time, so they don’t become an additional burden down the road. Organize critical paperwork such as death certificates and pre-planned funeral arrangements and try to ensure healthcare coverage remains for you and your dependents.
Lean on others
You do not have to carry this burden alone. Not only should you turn to family and friends for practical and emotional support, but you should also get help with the financial and legal paperwork from professionals, such as your financial advisor, CPA, insurance agent or attorney. While it is important to enlist the assistance of professionals during periods of grief, take caution if you are forging new relationships, both emotionally and professionally, as some con artists prey on those most vulnerable during these times.
After Time Has Passed
Gather important resources
Slow and steady is the way to go. Gather and take stock of important paperwork and statements: wills and trusts, insurance policies, financial statements, personal identification, mortgages, retirement benefits, safety deposit box contents, business paperwork, military records, club memberships, and others. We have a created a Surviving Spouse Financial Checklist to help you with the many steps along the way.
Continue professional relationships
Continue to ask for help from professionals to address your evolving situation and firm up ongoing financial needs. Your financial advisor can assist with organizing investment accounts, changing account ownership, closing or consolidating accounts, and unraveling your spouse’s retirement plan benefits. Your attorney can help with settling estates and executing your spouse’s will. Insurance specialists can help clarify your healthcare coverage and life insurance policies. Accountants can work through necessary tax filings.
Get ready for life’s transitions
When you are ready to circle back to larger decisions you previously put on hold, don’t go it alone. Have your financial advisor take a fresh look at your finances and begin discussing your larger wealth interests and goals to fine-tune your financial plan. A few important topics to discuss include budgeting, investment interests and goals, and wills, trusts, and insurance coverages. These decisions are important to make deliberately and while you are clear-headed, not in haste.
It’s also important to accept that life has changed. Things will be different. A helpful book to learn more about the grief process in general is “Option B” by Sheryl Sandberg. Resist letting guilt prevent you from exploring the different paths this next chapter lays out for you. Something that might not have been a good fit for you as a couple might now make a lot of sense. It should be ok to go ahead and pursue that now.
Pre-Planning for Losses
Because losing a spouse can happen unexpectedly, it is important to pre-plan for when one or both of you pass away. Pre-planning saves your spouse and dependents from being forced to make difficult legal and financial decisions during periods of grief and stress. Pre-planning activities may include drafting or updating wills and trusts, naming powers of attorney, and pre-planning funeral arrangements.
Losing a spouse or any loved one is difficult, but advanced preparation, trustworthy professional help, and a methodical timeline to tackle necessary tasks can help ease the burden, leaving you more time to remember and memorialize your loved one.