Financial Advice to the Newly Widowed - Planning for the Future

Start With the Basics

Often dealing with finances on your own means starting with the basics. Consider the following items at the top of your list and ask friends or family members for help and support:

• Death Certificate – If you have joint checking or savings accounts and other financial accounts such as stocks, bonds, 401(k), or pension plans, you will most likely need to provide proof of death with a death certificate. Most funeral homes offer this service, which is included in the funeral costs. Often you will receive up to ten death certificates and can request more from the funeral director if needed.
• Will – If your spouse had a will, you will need this to settle the estate. If there is no will, find out what the laws are in your state for people who pass away with no will in place.
• Life Insurance – If your loved one had any life insurance policies, along with the death certificate, you will need to contact the insurance company and inform them of your loss. If your loved one had an insurance policy through their job, the company’s human resources department can help you with this claim. If your loved one left insurance percentages to more than one beneficiary, they may require you submit signed forms from all the beneficiaries listed on the policy.
• Health Care – If you were covered under your spouse’s health care coverage, call the human resources department where they worked and ask about your COBRA options to ensure you keep health insurance until you can find a plan on your own.
• Employer Benefits – Check with your spouse’s human resource department to see if you are eligible to receive any accumulated sick, personal or vacation time your spouse accrued.

Image Credit: Life Insurance by Obsessive Creative/The Commons

Finances, Bills, and Credit Cards

Along with the basics you will need to take care of other matters including:

• Finance – Gather all your financial and investment papers together. This can include joint bank accounts, stock or bond investments, retirement plans, and mutual funds and CDs. Speak with a financial advisor to have the accounts transferred to your name only. You will also be required to provide a death certificate. Don’t cash out all your investments; you may need them for your retirement.
• Bills – You also need to collect all of your living expenses or bills you pay each month. These include your mortgage or rent payments, utilities, homeowner’s insurance or homeowner’s fees, and property taxes. While it’s not required to remove your spouses name from these types of bills, it’s best, especially if you plan to payoff your mortgage or other loans with your spouse’s life insurance.
• Credit Cards – Most couples have more than one joint credit card account. If you do, call the credit card companies to discontinue your spouse’s card to avoid annual fees. If you aren’t the primary card holder on the account, you may have to supply a death certificate. Consider consolidating or eliminating some of your credit cards and only keep the ones you think you need.

Continue on the next page for more financial advice for the newly widowed, including what to do about co-owned automobiles and veteran’s benefits.

Automobiles and Other Benefits

If you own vehicles in which both of you are listed on the title and registration or the loan contract, you will need to have these converted to you name only. Again, you will need a copy of the death certificate to show proof.

Consider other benefits your spouse may have had. Was he or she a veteran? If so call the Veteran’s Administration to inquire about any benefits. If your spouse was a member of a union or a professional society that offered benefits upon joining, find out what they were by calling the organization to see how you can receive them. Don’t forget items like death benefits from credit card plans or insurance plans that provide a spouse living expense support after a spouse’s death.

Image Credit: 1940s Automobile by FrogMiller / The Commons

Avoid Predators Offering Financial Advice to the Newly Widowed

Many predatory lenders will attempt to take advantage of widows by offering them refinancing on loans or mortgages. Because you are most likely at a low point, it’s easy for them to take advantage of your situation so beware of these types of organizations.

Banks and credit unions may also tell you that in order to protect yourself, you need to open a line of credit. They usually make these in large amounts, often up to $100,000 with high interest rates. Consider if you really need a line of credit? Has your spouse left you with enough insurance and retirement funds to live on? If so, avoid lines of credit that become too tempting to use.

Be Prepared Ahead of Time

Most spouses do communicate and let each other know what accounts they’ve open, investments they’ve made, and insurances they’ve purchased. A spouse may, however, enroll in a credit card life insurance plan without telling the spouse.

As hard as it may seem, be prepared ahead of time and gather everything financial in your lives. Include wills, monthly obligations, mortgages, investments, life insurance, credit life insurance, and all death benefits both of you are eligible to receive.

The best financial advice to newly widowed people is to be prepared ahead of time. If you suddenly find yourself widowed, ask for help from friends or family members. It’s often a great way to relieve part of your burden if you have help gathering items and applying for benefits upon your spouse’s death.