Departments — 02 February 2018
Financial lessons learned when a spouse dies

By Robyn A. Friedman

City & Shore PRIME magazine

As a financial columnist, I’m familiar with subjects like taxes, insurance, wealth creation and retirement planning. But when my husband passed away recently without warning, both my knowledge and advance planning were tested.

“Losing a spouse may be the most stressful time in someone’s life,” says Michael Silver, a certified financial planner with Baron Silver Stevens Financial Advisors in Boca Raton. “It’s probably the worst time to attempt to understand finances and make important financial decisions – this often leads to financial mistakes and an extreme level of stress and anxiety.”

Even though I was the spouse primarily responsible for finances in our household, there are many things that I should have done differently — mistakes I won’t repeat again. Here are just a few of the things I learned, which I’m sharing in the hope others will be able to avoid the challenges I faced.

  1. Maintain at least a minimum amount of life insurance on each spouse — even if both spouses are working and your children are grown. Those funds can come in handy to cover funeral costs, legal fees and other expenses of estate administration — without having to dip into savings.
  2. Check on a regular basis to make sure all insurance policies and retirement plans name the desired beneficiaries.
  3. Review ownership of bank accounts and other assets. Assets such as bank accounts that are solely in the name of the deceased spouse become estate assets and cannot be accessed until the will is probated.
  4. Know where original wills and other important documents, such as insurance policies, are kept. And keep a record of all assets owned, including account numbers. A friend told me that one of the greatest gifts her father ever gave her was a binder containing his final instructions as well as bank account and other asset information. After his death, every step was laid out for her, making her life much easier at a difficult time.
  5. Be aware that home and auto insurance policies may need to be reissued. After I sold my husband’s car, I called the insurance company to remove that car from our policy. It wasn’t quite that simple. His death triggered the cancellation of my homeowners and auto insurance policies, both of which had to be reissued in my name only — at current rates. Due to the hurricanes last summer, my homeowners-insurance premium increased substantially — and six months early.
  6. Consider pre-planning your funeral. That way, family members don’t have to make important decisions during a period of extreme stress — and the deceased gets to choose what he or she would like.
  7. Know your spouse’s passwords to, well, everything. That will allow you to not only access bank accounts and pay bills, but also to close social media accounts if desired.
  8. After your spouse dies, you will need to update your complete estate plan, beneficiary designations, living will, powers of attorney and health-care proxies.
  9. Take your time making decisions. Don’t be rushed into anything. The death of a spouse is perhaps the most stressful life event you can experience. The immediate aftermath is not a good time to be making important decisions.
  10. Be alert to people who might want to prey on you. Immediately after my husband’s death, a neighbor — a real estate agent I’ve known for many years — stopped by, presumably to express his condolences. Within minutes, he whipped out his business card and handed it to me, saying, “You’ll probably be wanting to sell the house now.” Actually, I didn’t — but when I ultimately do, he won’t be getting my business.

People say that in times of crisis, you learn who your true friends are. I was fortunate to be surrounded by close friends and trusted business associates, who provided me with the advice and guidance that got me through a very difficult time.

 

 

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