Financial Tasks After the Loss of a Spouse: Helpful Tips for Seniors
August 8th, 2019 by L. Rosetti
The loss of a spouse comes with a variety of emotions, and it can feel as though you are on a rollercoaster that you’d really love to get off of. For seniors, the death of a spouse means laying a best friend to rest, sorting through a lifetime’s worth of memories, and grieving the loss of your partner, but you must also make some important decisions regarding finances. It can be hard to focus on the financial end of a spouse’s death in the wake of everything else going on, but the tips below will help you navigate through.
Build a Support System
You might already have supportive friends and family, but you need a financial support system in your corner as well. Arrange a meeting with a financial adviser so that you can better understand your financial situation, especially if you weren’t the one in charge of the finances. An adviser can help you prep for the future, as well as make sure that your investments and portfolio are where they should be. You might also consider appointing a loved one to take on legal advocacy roles so that they are legally authorized to act and make decisions on your behalf regarding finances and healthcare. This can be achieved by designating a power of attorney who will act in your best interest financially and medically should you be unable to. You should also create a living will that details what medical treatments you do and don’t want such as lifesaving measures and organ donation. In some states, the power of attorney and living will are a single form known as an advanced directive, but regardless, it is wise to have both.
Collect Your Survivor Benefits
Your spouse likely has various benefits in place such as life insurance, Social Security, veterans benefits, and employee benefits that you can collect after your spouse passes away. Life insurance will be one of the main benefits you receive, and it will be a large and important source of income. You can choose to be paid in a single payment or have it spaced out into payments received over a designated period of time.
At this point, you might also consider selling your own life insurance policy via a life settlement, especially if you no longer have children who will be dependent on this income. The income you receive will be an extra supplement in addition to the funds you receive from your spouse’s policy, and it can be used for expenses or medical costs in the future. Social Security will be another helpful source of income and can be collected if you are age 60 or older. You may also qualify for a one-time death benefit that will go toward funeral expenses. A visit to your local Social Security office will provide you with the necessary forms and information.
Take Your Time
Most people will tell you that it is best to hold off on any major financial decisions until you have had time to grieve and can make an informed decision with a clear head. Selling your home to start over or paying off large debts your spouse was still paying on might seem like a smart move, but it could lead to some big problems down the road and put your financial situation in turmoil. The same applies if you find yourself receiving a large sum of inheritance or a big insurance payout. Let it sit in the bank until you have met with a financial advisor who can help you plan out how the money will be used. For example, you may choose to invest some of it, put some away in savings, pay off debt, or travel. If you are planning on selling your home, make sure you have an idea of how much you can expect to receive from the sale. The choice is yours, but there is no need to rush. Immediately following the death of your spouse, the best thing you can do is take care of yourself. Put yourself first, grieve, and focus on adjusting to this new life.
The death of a spouse comes with many decisions and new experiences. When it comes to your finances, seek out the support of professionals who can guide you. Claim the benefits you are entitled to, but take your time. Grieving is a process, not a race.
Posted in: Planning