Society of Certified Senior Advisors: What To Do When Your Spouse Is Dying

Financial matters may be the furthest thing from your mind when a spouse is dying, but it’s crucial to review them.

COVID-19 has taken more than half a million American lives in the past year. Grief has been a national pastime, reminding all of us that we never know when our time is coming. If you should find yourself in the awful situation of having a dying spouse, or preferably, before this happens, there are steps you should take for your financial future to ensure a smoother transition.

While it may seem callous to consider finances at such a time, your spouse will likely be comforted knowing that you will have the tools you need to manage after they are gone. The last thing you will want to do in the depths of your sorrow is to figure out how to access bank accounts or where your spouse kept the key to the safe deposit box. While comfort and care are preeminent concerns for a terminal spouse, a talk (or several talks) about finances cannot be neglected.

Documents

Paperwork regarding medical care and finances should be in one spot so it can be easily accessed. “You want to avoid the ‘treasure hunt’ after someone is incapacitated or has died, and you are running out of time with terminal illness,” says George Reilly, founder of Safe Harbor Financial Advisors. The following documents should be updated, if necessary, and readily available:

Will
Durable power of attorney
Advanced health care directives
Life insurance policy
Investment portfolio
Retirement accounts
Pensions

Everplans Has You Covered

According to a survey by legal services site Rocket Lawyer, 64% of Americans don’t have a will. The general lack of planning around death led to the creation of Everplans, an online site where you can store all the documents loved ones will need in the event of your death. A wealth of resources includes articles on such topics as what to wear to a funeral and state-by-state guides on estate and death taxes.

Professionals

Make sure you have names and contact information for the team of professionals who manage your finances. Who will you turn to for tax preparation, legal advice, or help deciding how to invest a portfolio of stocks and bonds? Who can help claim insurance? Who will sell off a business, or carry out a transfer to employees or other wishes?

Financial advisors
Accountants
Lawyers
Insurance agents
Small business professionals

Updating Documents

There are many stories about assets accidentally left to a long-ago girlfriend or former spouse because beneficiaries were never updated. That kind of mistake cannot be corrected after death, so make sure wills and accounts are current. It is not enough to update your will, since the beneficiaries listed on an account (think bank accounts and invested assets) will supersede those listed in a will.

Do I Need an Estate Plan?

For starters, you definitely need a will if you own a house or car, have bank assets, and/or want assets to go to people other than your direct relatives. If you don’t have a will, the state will dictate where your assets go upon death. The process could take a long time to wind through the courts, and it may cost your heirs unnecessary expense. Check if your state charges estate or inheritance taxes and if your assets are large enough to be subject to them. An estate plan can minimize the probate process, including delays and lack of privacy. Philanthropic donations and business succession plans can be covered in an estate plan.

Titling Accounts

Another way to avoid the pain of probate is to make sure accounts are titled properly, according to Rob Greenman, lead advisor and partner at Vista Capital Partners. Accounts with joint owners should be titled “joint owners with rights of survivorship” so survivors can continue to pay expenses. States differ as to how accounts should work.

Online Access

Many people opt out of paper statements, leaving heirs no trail to follow. It is absolutely critical to know the computer password and passwords to individual sites, such as bank, brokerage or insurance company. Mac computers store password keys, but they are useless if you can’t get in the computer itself.

It will save multiple headaches if you have a list of all needed passwords and all accounts. Speaking of accounts, verify that you know every one your spouse has. Over the course of decades, he or she may have changed banks multiple times or added an online bank for higher interest. Money may be split between brokerages, or there could be an old 401(k) at a previous employer.

Coming to terms emotionally with having a dying spouse is a terrible burden. But it is important to make sure that all the pieces are in place for a financially sound future for yourself. There will be many hurdles ahead: make sure that settling money matters is not one of them.