The loss of a spouse is one of the most stressful events you can experience in your lifetime. It’s something that is too painful for many people to think about, much less speak openly about. Most everyone knows someone who’s lost their partner, sometimes after a long bittersweet goodbye. And, often it happens suddenly. When death happens unexpectedly in your circle, it causes a visceral response. You feel it. It’s life’s reminder of your own mortality. It allows you to have empathy, to put yourself in the surviving spouse’s shoes, what if that were my husband, my wife? A thought that can be so uncomfortable to think about, you brush it away and quickly move on thinking about ways you can show support to your grieving friend. Casserole? Flowers? A phone call?
No one wants to think it will happen to them. It’s human nature to have compassion for your friend while simultaneously breathing a sigh of relief that it wasn’t your spouse. But, that uneasy feeling in the pit of your stomach is there for a reason. Death is hard, it’s overwhelming both emotionally, and financially. You will never be ready emotionally to lose your partner, that’s a process of healing that requires time to pass. As time passes you’ll slowly adapt to your new normal, and little by little the pain of loss begins to lose its edge. Financially speaking, allowing too much time to pass has the reverse effect.
Dr. John Maxwell said it best: “You choose how you approach life, if you’re proactive you focus on preparing, if you’re reactive you focus on repairing.”
When your spouse passes, you should be focused on repairing your heart, not your finances.
Read on for three action steps to take now, while you and your honey are both living, to protect each other from financial overwhelm.
Action Step One: Take Inventory
Make it a date night. Order a pizza, pour a glass of wine and connect with your partner. Grab a pen and a piece of paper or fire up a spreadsheet. Make a list of your joint and individual assets, accounts, bills, debts, insurance policies, expenses and income sources.
Transparency is key. If you’re ahead of the game and feel that you have a good grasp on the household financial picture, don’t assume the same for your spouse and vice versa. The devil is in the details. This drill is meant to be a dual effort. This is your opportunity to check in with your partner and compare notes. Maybe you never mentioned that you signed up for a monthly recurring Pilates package at $200 a month. Maybe your spouse didn’t think to tell you he opened a Home Depot credit card he’s been using for some extra perks. This inventory session is designed to pave the path for action step two. Taking inventory and sharing it with your partner is not a one-and-done deal. So, consider making this an annual date night.
Action Step Two: Take Initiative
Now that you’ve spilled the beans over a pizza, the next step is to take initiative on a few practical matters. For instance, there is a difference between being a joint account owner versus an authorized user. Consider that Home Depot card you just found out about—as an authorized user you can make purchases using the card, but only as a joint owner can you close the account if/when your spouse passes.
Beyond credit cards, this applies to cell phone providers, loans, and bank and brokerage accounts. Take the initiative, and verify that you and your spouse have joint ownership of your important accounts. When it comes to your liquid assets, money in the bank or brokerage accounts, adding the letters “TOD” transfer on death for brokerage accounts, stocks, bonds and other investments or “POD” payable on death for checking and savings accounts will ensure that if you and your spouse pass away simultaneously that your joint accounts will transfer directly to your named beneficiaries, skipping the lengthy probate process. Another quick tip to taking initiative is to share not only the passcode to each other’s cell phones, but take it a step further by adding your face ID on each other’s device. If you’re anything like me, most of my important logins, passwords, pins, cherished photos and video memories are on your phone. In the event of an emergency, recalling a password in a panic is stressful; adding face recognition allows for more immediate access and more immediate action.
Action Step Three: Be Intentional
When you are intentional, you choose to make decisions and take action on what’s important to you. Being intentional means being clear about what you want to achieve for a future outcome. That financial inventory you connected on? Be intentional about updating it at least annually, keep a binder or filing cabinet that contains your annual inventory list, important financial documents and any wills or legal documents like car titles and deeds.
A VIP contacts list should be a part of the binder. Include the contact for benefit providers like your employer’s HR department or plan administrator. Remember to add the contact information for any professionals you work with like your financial advisor, attorney, CPA or estate planners. Be sure to include copies of your passports, driver’s licenses, marriage certificate and of course any life insurance policies. Lastly, be intentional about where you keep this sensitive information. Consider sharing your hidden repository with one other trusted adult. Having a digital, password-protected version of these documents is wise.
As much as I’d personally love to believe that all couples in love pass away notebook-style holding hands in the nursing home bed on the same day, it’s unlikely. You will never be emotionally prepared to lose your beloved. Preparing financially for the death of your spouse, while they’re still here to have a say, is truly an act of love.
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