How To Manage Finances After A Spouse's Death

Don't wait until your spouse dies to learn about the state of your finances. Act now to plan an effective survivor's financial strategy.

Though no one likes to think about losing a spouse, it is important to plan ahead for when the inevitable happens. Either spouse could go first, so both marriage partners need to understand joint finances and establish a plan to care for the survivor's financial needs.

If you are not sure about the condition of your finances, here are some suggestions to help you start working on a plan of fiscal management for whoever survives the other.

1. Get legal advice. Consult an estate planning, probate, or tax attorney for help in developing a long-term marital financial plan. A professional can advise you about the kinds of choices you need to make as you look into the future. If you made a plan before your spouse passed away, all you need do is contact the attorney who will process the necessary forms.

2. Prepare the appropriate documents in advance with your spouse's help. A Last Will and Testament is the place to start, which will arrange for any remaining debts to be paid and provide your spouse with residual funds. A will also outlines a distribution of assets so that anyone who receives something from you can't argue about who should get what. This will save wear and tear on the surviving spouse, as well.

3. Invest in a life insurance policy for both partners and keep premiums paid up. When a death occurs, the policy can be paid promptly to take care of expenses and provide for the survivor. Some couples take out more than one policy to ensure that the survivor receives adequate support.

4. Keep important papers like the will and insurance policy in a safe place, like a safe deposit box at your bank or a home document vault. Make a list of everything that is kept there, and give a copy to the person who is named as the executor of both your will and your spouse's. Sometimes an attorney and a family friend hold copies, as well.

5. Don't attempt to deal with business matters immediately following a spouse's passing. Give yourself a few days to get over the shock of your loss and to mourn the beloved through a funeral and lingering friends or family members. Contact your attorney or insurance provider only when you feel ready to handle the business aspects.

6. Ask for help, if needed. A close family member or a trusted friend may be able to answer questions and help you make decisions. Plan who this person (or persons) will be and ask if he or she is willing to help in that capacity.

7. After an attorney has processed the departed's will and opened an estate, if applicable, arrange to discuss long-term financial plans. Policies and a will dated decades before may prove inadequate under current circumstances. You may need to check social security eligibility, pension benefits, and your full-time or part-time employment status to determine the wisest course of action to conserve financial holdings and live comfortably.

Losing a loved one is always difficult. Make it a little easier by planning your financial needs ahead of time. Discussing documents with your spouse and an attorney can lead to peace of mind that will be greatly appreciated at the time of your loss.

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