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Financial Advice: Recently Widowed – Now What?

Recently Widowed - Seven immediate ‘must-do’ financial tips. Stock photo

West Hartford Magazine columnist Whitney F. Burr offers seven immediate ‘must-do’ financial tips for those who are recently widowed.

By Whitney F. Burr, Investment Consultant, Valerie E. Thomas & Associates, LLC

You have said goodbye to your loved one, your family and friends have returned to their day-to-day routines. Even with all the pain of losing your spouse, you now need to focus on carrying on, even though your world has been turned upside down. Many of the daily life decisions that you made together now must be made by you alone.

It is important that you avoid making any major life-altering decisions within the first year. This includes large purchases such as buying a car or selling your house and moving cross country to live with your kids. It is best to take your time and consider all your options. Financial decisions are one of the first things you will have to address and get into order.

Important advisors who can help you along the way are your attorney, accountant, and financial advisor. Here is how each one can help you:

Attorney: An estate attorney will guide you through the probate process. I would not suggest trying to combat this yourself. Additionally, your attorney will be able to make changes to your estate planning documents, such as your will, living will, and power of attorney.

Certified Public Accountant: The death of a spouse can make filing taxes and adjusting your tax situation even more complicated, so a CPA is an important advisor to contact. A CPA can help you determine which spousal benefits are taxable and which ones are not. Once it comes time to file your taxes, your CPA can help you maximize deductions and plan for all of your upcoming tax obligations.

Financial Advisor: A trusted financial advisor is one of the most important advisors to meet with after the death of a spouse, because they can help you work towards a confident financial future. They can help with your current income level, life insurance proceeds, and what to do with your investments now that your spouse has passed. They will also assist you with designating new beneficiaries and will help you to determine if probate is necessary.

With your three trusted advisors by your side, here are the seven most important financial priorities to consider:

(1) Probate
If you are the executor of your spouse’s estate, and your spouse left a will, then you must probate the will. Depending on how complex the estate is, the process can take as little as a few weeks or it could take several years to successfully complete. Having an estate attorney by your side, will take the stress and work off of you. Make sure you get at least three certified copies of the death certificate as soon as you can.

(2) Life insurance
There are two potential sources of life insurance coverage that your spouse may have had: insurance you purchased through an insurance agent or any employer policy that they may have had with an existing or past employer. Starting the process to receive life insurance proceeds may be drastically different for both sources. Your insurance agent and/or spouse’s employer can help you with the process.

(3) Apply for benefits
Depending on your age and your spouse’s age, there are likely some benefits you are entitled to. These potentially could include a one-time Social Security death benefit, Social Security retirement benefits, Veteran’s Administration benefit for military veterans, and employer benefits if your spouse was still employed at the time of his or her passing. If you are over age 60 at the time of your spouse’s death, you may be entitled to survivor benefits in addition to a one-time death benefit from Social Security. You will need to contact your local Social Security office to see what you are entitled to. If your spouse received monthly disability payments from the military, you may be entitled to continue those payments. Contact the Veterans Administration to discuss what benefits are available to you. Lastly, if your spouse was employed at the time of his or her passing, contact the company’s human resources department to discuss any employee benefits to which you may be entitled to as a surviving spouse.

(4) Retitle accounts/cancel creditor payments
Contact your bank, financial institutions, and investment management accounts to have all your jointly-held accounts moved into just your name. Make sure to include copies of the death certificate to facilitate these requests.

(5) Review loans, bills, and financial obligations
Make a list of all of the bills, expenses, loans, and other financial obligations you have, separating them by ownership. Contact all creditors that you have in joint name and have them transfer to just your name.

(6) Cancel payments
Some payments can be canceled immediately, such as golf or gym memberships, and any professional association memberships.

(7) Consider the long term  
Meet with your Financial Advisor. You will need to update your estate plan and life insurance policies. You will have to look at your investment portfolio and make sure it is working for you.

Valerie E. Thomas & Associates, LLC, located in West Hartford, CT, also offers custom estate planning, retirement planning, and income distribution. 860-678-6260, www.valeriethomas.comInvestment Advisory Services and Securities offered through LPL Financial. A Registered Investment Advisor – Member FINRA/SIPC

Originally published in our sister publication, West Hartford Magazine, Issue 1, 2017. To subscribe, please click here. 

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