Jessica is Co-founder & President of Oak Harvest Financial Group, a firm specializing in holistic retirement planning & wealth management.
One of the most painful, gut-wrenching days many of us will ever face is the one in which our spouse or significant other passes. Unfortunately, none of us are promised tomorrow—life does not play favorites. When the day comes, it’s critical to make sure there aren’t additional stressors for the surviving spouse—especially when it comes to your money.
American author and pastor Dr. John Maxwell said it well: “If you’re proactive, you focus on preparing. If you’re reactive, you end up focusing on repairing.”
Many do not prioritize doing today what they hope to put off until tomorrow. When it comes to your finances, you should have a trusted plan and/or team to help you (or your spouse) adjust to a new normal.
Financial matters are not the highest priority in the days and weeks after losing your spouse. You’ll be focused on repairing your heart and head. Loss is overwhelming; allow time and space for that process. Focus only on making the decisions you have to make during this time. Big decisions, especially financial ones, should not be made when emotions are high. And, when you’re ready, start here:
1. Connect With Your Dream Team
The first thing you will want to do is to contact what I refer to as your dream team—attorney, certified public accountant (CPA) and financial advisor.
If you don’t have these individuals present in your life, make it a priority to get recommendations from trusted family and friends for a second opinion and a sounding board. Recruiting the appropriate team to guide you ensures an unemotional and pragmatic approach during an emotional season.
Will help you understand both the legal and financial laws in your state, ensuring your assets stay protected.
Will ensure you understand the tax implications of losing your spouse. There are very specific ways that taxes can be completed to reduce the IRS’s share.
Will ensure your financial plan meets your current objectives, including investment accounts, beneficiaries, income streams and tax strategies.
Your dream team will provide guidance and reassurance to help you navigate new realities, like losing a Social Security check or filing under a new tax status. Lean on their expert guidance for peace of mind.
2. Obtain The Will And Death Certificate
You’ll need to secure your spouse’s will to avoid issues of probate and to deal with assets that aren’t “jointly” owned. This is where your attorney can be of great assistance.
Next, obtain multiple copies of the death certificate. You’ll likely need one copy for each company you have any financial connection with. And you’ll want to keep a few extra copies for your files. Think 15-20 copies.
The death certificate will be required to transfer assets or update ownership of the assets. The funeral home may be of assistance in ordering them, or you can visit your city’s records department. Alternatively, there are select online companies that are authorized to send copies to you upon request.
There will be a small fee for copies of death certificates, and they usually take four to eight weeks to arrive. Act swiftly, be patient and use this time to compile a list of companies/entities you’ll need to notify of your spouse’s passing.
3. Contact Important Organizations
The next step will require you to contact key organizations:
Social Security Administration
You need to inform them of your spouse’s passing to ensure payments and potential spousal benefits are handled correctly, especially if there is an active benefit being paid to the deceased spouse.
In many cases, the funeral home will help report your spouse’s death to the Social Security Administration, but you will want to be 100% sure. Be sure to inform your dream team at this stage as you don’t want to leave any money on the table that’s owed to you.
Inform them if your spouse was a veteran, as the VA benefits they were receiving could be transferable to you as the surviving spouse. Again, consult with your dream team on this.
Contact all of your spouse’s insurance companies, including life and health. You’ll want to gather all the claim forms required so you can start pushing paper to those companies. The sooner you start this process, the faster you may see benefits pay out to you.
Contact all three—Equifax, Experian and Transunion—to inform them of your spouse’s death. Request that a “death notice” be put on the credit reports to prevent fraud or someone trying to steal your deceased spouse’s identity.
4. Inform Current And Past Employers
Notify the human resource departments of all current and past employers.
You’d be surprised how many employer-sponsored plans (e.g., 401(k) or pension) from past employers are never transferred. This is money that you as a beneficiary want to be sure to collect. Don’t assume. Make the call to be sure.
And don’t forget about yourself—notify your own employer if you are still working during this life event, as it may trigger benefit adjustments that you’ll need to make.
5. Update Asset Ownership
While it’s last on the list, it’s critical to update asset ownership. Be prepared to provide each company holding your spouse’s assets with a copy of the death certificate, as it will be required to transfer them to you as the beneficiary.
Here are some examples of assets you’ll want to update:
Includes your home and vehicle titles. Notify the county recorder for tax purposes.
All financial institutions where you had joint accounts and “payable on death” beneficiaries listing yourself.
Your financial advisor can help get all of your investments updated, including your beneficiaries.
There’s much to be done on the financial side when your spouse passes. Advanced preparation and knowing where to turn can save you time and frustration.
Remember, all of these things will take some time. Allow yourself the time you need to walk through the loss in a healthy way, one day at a time.
The information provided here is not legal, investment, tax or financial advice and does not purport to be a substitute for advice of counsel on any specific matter. You should consult with a licensed professional and/or an attorney for advice concerning your specific situation.
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