Financial Planning After Losing a Spouse

Losing a spouse, whether through death or divorce, can be devastating emotionally and financially. The loss can take months or even years to recover since there is no way to prepare for death or divorce even when spouses have discussed contingencies with each other or with their advisor. When it comes to financial decisions some things need to be taken care of almost immediately, but leaving decisions with long-term consequences for when the mind is clear is best, despite a broken heart. Items that require timely updates and beneficiary changes after losing a spouse:

  • Work Place Benefits- 401(k) and Employer Health and Life Insurance. Employer retirement savings and life insurance plans both require beneficiary designations; if the beneficiary were a spouse, a new beneficiary will need to be named. If on the lost spouse’s health insurance through their employer, the remaining spouse will need to find new insurance coverage. A death certificate may be required to remove a spouse as a beneficiary that has passed away or a divorce decree to remove a spouse after a divorce.
  • Joint Accounts- Brokerage, Bank and Bank Loans and Credit Cards. All joint accounts will need to have the spouse removed (if death) or divide per terms of the divorce. In most instances, loans will need to satisfy or new loans underwritten to request the removal of a spouse. In the example of death, a death certificate is required to remove the spouse from bank accounts and investments. For divorcees, contact your lender or brokerage account custodian for requirements on joint accounts
  • Joint Assets- A Primary Residence, Vehicles, and Other Real Estate Property. You will be required to retitle all property into your name alone or pay off loans to remove your spouse. Additionally, you may need to qualify for a new loan based on your income alone.
  • IRAs and Annuities. If your spouse were your beneficiary, you would need to name a new beneficiary on your IRAs and Annuities.
  • Social Security Benefits. Notify the Social Security Administration of the death of the spouse (divorce requires no notification). If the remaining spouse is already receiving Social Security retirement benefits, they will now receive their deceased spouse’s retirement benefits. If the remaining spouse is not yet receiving retirement benefits, but there are young children involved, the Social Security Benefits the deceased spouse would have received later will provide benefits to their children until age 18 or still in high school.

Losing a spouse is never easy, but planning for your future alone is essential. Start by dealing with what needs to be taken care of now. I am here to help you navigate your future and offer advice and financial planning as you move forward without your spouse.

*Advisory services offered through Trajan Wealth, L.L.C., an SEC-registered investment adviser. 

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