Financial Life After the Loss of a Spouse
Wealth
The loss of a spouse—whether due to death or divorce—is one of the most devastating experiences a person can face in life. To compound the emotional trauma and upheaval of being newly single, they may face uncertainty and stress relating to their changing financial future.
Some may lose financial wealth, while others may be in the position of managing a significant amount of money for the first time.
While money cannot heal a broken heart, some planning and basic decisions can help spouses protect their financial interests and avoid short-term mistakes that can have long-term implications on their financial health.
Plan Ahead
No one likes to think about the death of a spouse or a possible divorce, but planning ahead today will help provide a financial road map in case the unexpected should happen. The first step is sitting down with your team of advisors (including your financial advisor, insurance agent, and attorney) to help bring your financial picture into focus. It is important that both spouses have a handle on their current assets and liabilities (including bank accounts, investments, insurance, real estate, etc.).
In the event of a loss of spouse through divorce or death:
- Take stock of your financial situation.
Begin by gathering and organizing your financial statements, including bank and investment accounts, previously filed tax returns, and your current debt situation, including all mortgages, equity loans and lines of credit. Contact the three major credit reporting agencies and request a copy of your credit report.
- Get expert advice.
Once you have gathered your financial paperwork, turn to a trusted financial advisor for guidance and support. Unwinding the complex financial, estate, retirement, tax, insurance, and investment issues that accompany divorce or the death of a spouse can be especially daunting for a person under emotional duress. A financial advisor can help develop a plan that addresses both short-term and long-term income and asset needs, as well as identifying ways to fund those potential future needs.
Your financial advisor can coordinate with an attorney, who can assist with the many legal documents that will need to be updated following a divorce or the death of a spouse, including retitling assets, revising estate documents (such as wills and power of attorney), and updating beneficiaries associated with life insurance policies and retirement accounts.
- Put off most major decisions for a year.
Most financial experts believe that the biggest mistake most people make is moving too quickly through the maze of decisions that must be made following the loss of a spouse from death or divorce. Making major and difficult financial decisions—such as selling a house or moving—during a highly stressful and emotional time can lead to long-term negative financial implications.
Whether you are planning ahead or facing the sudden loss of a spouse, Enterprise Wealth Management is here for you. Let us help bring peace of mind to you and your loved ones when you need it most.
Daniel Burke, JD
Senior Financial Advisor
Senior Vice President
Daniel.Burke@ebtc.com
978-656-5609
Connect with me on LinkedIn
Investment and Insurance products are not a Deposit, not FDIC Insured, not guaranteed by Enterprise Bank, not Insured by any government agency, and may lose value.