By Nicole Louvar, AIF®
If you’re like most people, the practicalities of losing your spouse don’t even cross your mind. But the unfortunate truth is that it does happen—and sometimes when we least expect it—so it’s best to be prepared. Since women tend to live longer than men, widowhood is a possibility for many women today.
The loss of a spouse can be emotionally and financially devastating, especially if you’re unprepared for it. To help safeguard yourself and your family in the event of widowhood, there are several things you should do now to help maintain financial stability when the time comes.
Do You Have a Trust in Place?
If you and your spouse do not have a trust, consider drawing one up in order to control where your assets go now, and in the future. A trust ensures assets are protected and disbursed to the right heirs. You can have both a will and a trust, but while a will takes effect after one’s passing, a trust can be used both during life and after one’s passing. Be sure to ask your advisor about state laws when it comes to the differences between wills and trusts. For instance, in New York State a will must go through probate court, while a trust avoids probate court.
Without a trust, it can take 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. We have a team of trusted professionals who can work with you to identify the individual that is best suited to your needs.
What Benefits Are Available to You?
Understanding your benefits is another important aspect in 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 together with your loved one to make a list of all the benefits either of you will receive in the event of widowhood as well as the information needed to access these resources. We offer services that involve analyzing employer benefits to ensure that you are not missing out on any opportunities. As difficult as it may be, talking about these benefits ahead of time can help you both feel prepared if widowhood were to happen.
Do You Have Access to All Financial Account Information?
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 make sure both spouses have access to important financial account 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. Also keep in mind that in some cases, settling an estate may require a birth certificate and/or marriage certificate (even if you are divorced), so it’s important to keep these in a safe and accessible location.
Additionally, understanding how these accounts are titled (joint or individual), as well as 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.
What Does Your Spending Plan Look Like?
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.
Do You Have a Trusted Advisor?
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 are working with a financial advisor already, or you are looking to hire one, take your time getting to know them and 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.
You’re Not Alone
As difficult and uncomfortable as preparing for widowhood may be, making big financial decisions while you’re grieving could be even worse. At Guided Capital Wealth Management, we can help you plan for the future no matter what lies ahead. We’ll work with you to create a financial strategy that can prepare your family and leave them with the resources they’ll need when you or your spouse is gone. To take the first step, reach out to us at (832) 975-0711 or schedule a free no-obligation consultation with one of our advisors. If you’re not ready to talk, browse our free resources to help with your financial journey.
Nicole entered the field of financial services in 2000 in a highly specialized role as a commodities trader. She implemented buying and selling strategies for large companies in fast-paced environments. Using her corporate experience and degree in finance, she became Chief Operating Officer for Capital Wealth, a company she founded with her husband, Kyle in 2018. With her extensive background overseeing business plans and executing trading, it was natural for her to step into the role of creating financial plans for clients. Inspired by her work to help clients reach new milestones, Nicole has now added the role of Financial Advisor to her list of accomplishments. Her passion lies in working with women and helping them become more actively involved in and educated about their finances. Because she spends quality time getting to know her clients, her customized financial plans fit everyone’s unique goals and are supported by sound investment models.
Nicole graduated from New Mexico State University in 1999 with a degree in Finance. She currently serves on the NMSU Foundation Board. She and her husband Kyle have two daughters who love to play sports. She enjoys volunteering for her girls’ sports teams and at their school. In her free time Nicole loves to cook, travel, and play golf with her family.