One of the most challenging periods in anyone’s life occurs during their first year after losing a spouse. In addition to the trauma of loss, there’s the necessary effort involved in arranging your finances as a newly single person.
You may have a support system of family and friends to help you. But ultimately, the key financial choices are yours to make, and they can be profoundly burdensome.
Some Big Financial Pitfalls
Writing in The New York Times, Ron Leiber – For the Recently Widowed, Some Big Financial Pitfalls to Avoid – expressed the issue perfectly:
“Even if widows were the household money whizzes, however, they’re likely to find themselves navigating an overwhelming mix of emotions. There is grief and despair, fears both rational and irrational and often a desperate urge to take action – any action – that will allow them to move on. But with important financial decisions, speed can make a mess of things.”
Expert Financial Help
It’s during this period that it’s crucial for the recently widowed to seek expert financial help. It’s certainly not the time to act impulsively. What follows are just a few of the financial issues you should be considering:
- Dealing with pension survivor options
- Old Age Security spousal benefits
- Life insurance proceeds
- Changing the title on your home and other assets
- Making sure your bills continue to get paid on time
- Updating your Will and estate planning documents
All these issues and more are tough enough to handle under normal circumstances. But when you’re grief-stricken? Frankly, it doesn’t bear thinking about.
Refrain From Following Your Friends’ & Family’s Financial Advice
Daisy Chan, writing for considerable.com – 5 financial steps you need to take if you’re a widow (March 9, 2015) – made, among many other important observations, the following assertion: ‘Refrain from following your friends’ and family’s financial advice.’
This may seem harsh, but it’s vitally important. Well-meaning friends and family often offer financial advice, and widows go along with it because they’re too exhausted emotionally to deal with their finances themselves – or they feel guilty if they don’t let people help them. But this can lead to bad decisions.
7 Vital Steps
The key is to get a team of trusted professional advisors – your investment advisor and financial planner, lawyer and insurance advisor – and consider the following 7 vital but necessary steps:
- Probate the Will
- Deal with life insurance
- Apply for survivor benefits
- Retitle accounts
- Review loans, bills and financial obligations
- Cancel pre authorized payments, such as gyms, clubs and other memberships
- Consider the long term
Seek Professional Assistance
Eventually, you’ll need to re-evaluate and update your own estate plan and life insurance policies as well as revise your total financial picture including your investment portfolio, loans, housing and other issues. It will become imperative that you make decisions about the direction you want your future to take. For example, you’ll possibly need to decide if you’d prefer to move or continue living in the home you shared with your partner.
The loss of a spouse is one of the most stressful events in life. Our advisors can help play an important role in alleviating that stress. Please contact us to learn more.