Back in my days as a bank manager, Lilian and John* would occasionally stop and chat on their visits to the branch. It was always enjoyable to see them. The pair had been married for over 55 years, and would tease each other about how she managed all the bank accounts and he always did the taxes and maintained the other household records. Their dynamic is not unusual. Couples frequently develop a routine of dividing and conquering life’s tasks. But what happens when one is suddenly faced with having to do them all?
In a letter to an acquaintance back in 1789, Benjamin Franklin wrote, “…in this world nothing can be said to be certain, except death and taxes.” Preparing financially for loss will not diminish sorrow, but it can reduce the stress and fear of suddenly becoming the sole financial decision maker. Preparation can give a surviving spouse strength and confidence to navigate the days and months ahead.
Here are several actions that couples can take to prepare financially for the loss of a spouse:
- Don’t wait! Make a plan to set aside savings for the future needs, for retirement, and for care. The earlier you start, the more your savings can build.
- Together, make a list of all bank and investment accounts. Include bank name and location, account numbers, names on the accounts. If you have a contact at an institution, list that individual as well. Note how you access each account, whether online or in person. If there is someone you trust, tell them where you have this list.
- Make a list of passwords for all devices and accounts you wish the other to have access to.
- Review finances together on a regular basis. Evaluate sources of income, your spending patterns, assets, and debts. Discuss plans for how you would like to spend your money, and consider the needs of a surviving spouse.
- Write a will if you don’t have one. Review your will periodically if you do have one. Life changes, and your will needs to reflect that.
- Plan and pay for funeral needs now so the surviving spouse does not need to worry about them during what is likely one of the most difficult times in their life. However, do not put funeral wishes in your will. It usually takes too long to access that information.
- Check beneficiary designations on retirement accounts, life insurance, pensions, and other assets. Children, divorce, death, re-marriage, and other life events may necessitate a review.
This is not a comprehensive list, but these are fairly simple steps that couples can take to ease the financial burden of loss. Full estate planning requires legal and investment expertise, but more information can be found through the FDIC website.
*names have been changed