Suddenly Single

They say that there are only two things certain: death and taxes.  So it’s inevitable that at some point, one spouse in a marriage will find themselves “suddenly single.”  Most people try to avoid thinking about the death of their spouse.  But that often means that when it occurs, the spouse left behind is unprepared.  Statistics show that men typically pre-decease their wives.  Most couples have a division of labor, and traditionally that has involved leaving investment decisions to the husband and the care of the home and children to the wife.   What was once a team, where each member had their own role, the surviving spouse now has to do it all.  The survivor has lots of decisions to make.  These often begin before death and may involve the health care determinations for a spouse unable to make them on his or her own.

Funeral decisions come next.  In many cases arrangements have been made ahead of time, but there are still details that have to be made unless the deceased has left detailed instructions.  Do we know the names of all the friends or acquaintances of the deceased who should be notified?

After the funeral, the survivor is faced with a host of financial issues.  Assuming the surviving spouse is a widow she is often left with many vital but unanswered questions.

  • How will her income change?
    • We know that the income of the surviving spouse will change.  Income from sources such as pensions or social security usually decline.  On the other hand, income from other sources like insurance proceeds may go up.  Finding the answers is much easier before someone dies.
  • What is needed to maintain her lifestyle?
    • I have seen many instances where the widow did not know how much it took to maintain the home and all the other expenses that continue after a spouse dies.  It’s not because she is incompetent, it simply was not her job.  The time to make a list of these things is while the couple is still together.
  • Are there insurance policies and where are they? 
    • Hundreds of millions in life insurance goes unclaimed each year simply because people don’t know it exists.  Life insurance can be a vital resource to keep a family together, especially if the couple is still young.
  • Does the she know where all the family assets are?  Whose name are they in and how can they be transferred to her? 
    • Many people have investments scattered at various institutions.  Too often the spouse left behind doesn’t know where everything is and is left looking at the mail for statements from various investment firms.  This can be a serious problem if the accounts are not titled properly or the beneficiary is uncertain.
  • If she has relied on her husband for managing the family finances will she be able to take over?  Will age play a factor?  Who can you trust to help?
    • Many families take the do-it-yourself approach to managing the family assets.  The problem arises if the widow is unprepared to do it herself, leading to confusion and uncertainty.  This is also the time when people are vulnerable and can be exploited by unscrupulous advisors.  The best time to plan for the transition is while the both husband and wife are still alive and identify an investment professional who can be trusted to manage the family assets in her best interests after he is gone.
  • Who can she talk with to insure she does not run out of money?
    • This is a follow-up to the previous point.  The income needs of the widow are going to be different from those of the couple.  The trusted advisor should be able to create a financial plan that will take into consideration the changes in income, the assets that are left and a path to financial success.  The goal is to “finish stronger.”

Over the last quarter century I have been asked to help many people who have lost a spouse.  In many cases the grieving spouse did not know the answers to many of the previous questions which caused a great deal of additional anxiety.  It does not have to be that way.

I was inspired by my experience with the couples I advised and the widows who came to me after their husbands passed.  It also occurred to me that I was not immortal so I wrote “Before I Go” and the accompanying workbook in part for my wife.  “Before I Go” is designed to answer all the questions that she would have when I’m no longer here.  I think it allows her to “Finish Stronger.”

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