Cypress Wealth Services
No one wants to think about losing their spouse. Although it’s natural to avoid imagining such a devastating event, the last thing you need in a time of grief is to worry about all the legal and financial implications accompanying the loss of your spouse. Considering the difference in life expectancies for men and women, widowhood is an unfortunate possibility that requires preparation.
While it’s impossible to emotionally prepare for the loss of a life partner, taking some time to answer the following questions may help ease the financial burden if you ever find yourself in the difficult time of widowhood.
If you and your spouse do not have a trust, consider drawing one up immediately. A trust ensures your spouse’s assets are protected and disbursed to the right heirs appropriately. Unlike a will, trusts allow the owner to determine how their estate is disbursed rather than just listing their wishes.
In addition, trusts don’t need to go through the long and complicated process of probate that wills do. Without a trust, it will take a lot longer to get closure and the details about how assets should be passed on can get messy in the process. If you do have a trust, make sure it’s up to date by working with a qualified estate attorney to get all the legalities in place.
Understanding your benefits is another important aspect of preparing for the possibility of widowhood. Things like Social Security, life insurance, pensions, and annuities should be assessed ahead of time so that you're not struggling to make difficult financial decisions immediately after loss.
If your spouse is still working, other employer-sponsored benefits may also be available. Work with your loved one to make a list of all the benefits either of you will receive in the event of widowhood and the information needed to access these resources. As difficult as it may be, talking about these benefits ahead of time can help you both feel prepared if widowhood were to happen.
One of the hardest parts of widowhood is moving forward without the support of your spouse. Maybe they were the one who handled all of the day-to-day financial matters and now you are stepping into this role for the first time in your life. It can be overwhelming to say the least.
The best way to prepare for this possibility is to ensure both spouses have access to important financial information, including checking and savings accounts, retirement plans, and other investments. At a minimum, both spouses should have access to the account numbers and any log-in information.
Additionally, understanding how these accounts are titled (joint or individual) and who is listed as the beneficiary are crucial aspects of estate planning. Having joint ownership on all accounts, or listing each other as beneficiaries, can help the assets transfer smoothly by avoiding probate.
Life after widowhood will be challenging, but a detailed spending plan can help ease the transition by alleviating the stress of making day-to-day financial decisions. Start by creating a current budget, if you don’t have one already. Together, you and your spouse can discuss the types of expenses that will either be added or removed from the budget if widowhood were to happen. It may seem strange in the moment, but it can be an incredible aid when planning for the future.
Special attention should be paid to debts like mortgage payments, monthly utilities, car payments, credit card debt, and other loans. Understanding how these debts will be managed in the event of widowhood is crucial to creating a sound financial future for the surviving spouse. The last thing either spouse wants to do is leave behind debt that their loved ones can’t manage. Planning ahead can help alleviate this burden and provide comfort to both spouses knowing that their partner is going to be okay on their own.
Having a strong support system will carry you through widowhood and it will give you the strength to move forward. Part of that support system should be a trusted financial professional. Whether you’re working with a financial advisor already, or you’re looking to hire one, take your time getting to know them to make sure you like working together. If there is one spouse who tends to handle all financial matters, make it a point to introduce the other spouse to the financial team. Widowhood is a vulnerable time and it’s vital that both spouses feel comfortable reaching out for help with important financial matters. If one or both spouses don’t trust the advisor, it may be necessary to reevaluate the relationship.
Your well-being is of the utmost importance during this process, so don’t be afraid to interview several financial professionals before choosing the one you trust the most.
As difficult as this process is, preparing for the unexpected is always better than trying to pick up the pieces on your own after a loss occurs. At Cypress Wealth Services, our mission is to bring clarity and confidence to your financial life no matter which stage of life you’re in. We can help you and your spouse navigate the difficult decisions associated with the possibility of widowhood. As you take the next step in building a solid financial foundation, we are here to answer your questions. Call us at 866.888.6563 or contact one of our offices today.
Cypress Wealth Services is an independent RIA firm providing financial planning and investment management to high net worth individuals, families, business owners, and institutions. Cypress Wealth Services comprises professionals with diverse backgrounds and extensive experience and qualifications. Cypress Wealth Services is uniquely qualified to serve a broad range of client needs, and their experience and expertise act as a foundation for their client service process. The firm uses The Second Growth, which focuses on efficiently protecting, growing, and transferring the wealth and legacy a person has already built to their loved ones. With financial advisors in Palm Desert, CA, Tustin, CA, Athens, GA, and Anchorage, AK, the firm serves clients across the country in Wealth Management Services, Fiduciary Services, 401(k) Design and Management, Investment Reporting Services, Financial and Retirement Planning, and more. For more information, visit www.CypressWS.com or call 760.834.7250.