Tag Archives: money

Funeral Planning, funeral planning, Grief Support, Uncategorized

Navigating Financial Changes After the Death of a Spouse

The following is a post from guest writer, Sara Bailey.  You can find more information from her at www.The Widow.net.

Navigating Financial Changes After the Death of a Spouse

In an ideal world, family could take ample time to grieve after the death of a loved one. Unfortunately, surviving spouses must handle a variety of important financial matters in the weeks following a husband or wife’s passing. From keeping the lights on to saying goodbye to a home, here are some of the most important matters surviving spouses must contend with after their partner’s passing.

Organizing the Bills

If your spouse handled the finances or financial duties were shared, collecting information on all household and personal bills should be an early step after your spouse’s passing. Find out which bills are on automatic payment and which you must pay manually. In addition to paying all bills that are due, you’ll need to switch accounts in your spouse’s name to your own.

If you discover your bills are more than you can manage in your spouse’s absence, consider how you can adjust your budget. Reducing household expenses can cover small shortfalls, but if the gap is large, you may need to take a larger step like selling your home. During this time, it might help to hire a financial planner to ensure you’re making the right choices and taking the proper steps. However, it’s important to find someone you can trust with your finances.

Updating Estate Plans

If your spouse features in your estate plan as a power of attorney, health care proxy, guardian, or beneficiary, update these appointments promptly. You may feel unsure of who to name as a health care proxy or power of attorney now that your spouse is gone. Rather than choose the person closest to you, ask someone you trust to honor your wishes. Forbes offers additional advice for choosing a person to serve in these important roles.

In addition to naming a proxy and POA, surviving spouses must update beneficiary designations or risk a costly mistake. Beneficiary designations override wills in court, so if you update your will but not beneficiary forms, your assets will likely have to go through probate. CNBC advises surviving spouses to update beneficiary designations with IRA, 401(k), and 403(b) plans, life insurance policies, 529 accounts and any other account that transfers on death.

Reviewing Insurance Policies

Find paperwork for life, health and other insurance policies and notify companies of your spouse’s passing, filing claims as needed. You’ll need to provide copies of the death certificate. If you had health coverage under your spouse’s policy, you may be able to continue coverage under COBRA. However, you’ll be responsible for the whole premium without the employer cost share. If that’s not available or cost-effective, shop for insurance on your state’s marketplace. In addition to health insurance changes, your life insurance may no longer be needed without a living spouse or dependent children. Weigh whether your policy is worth keeping or if you should sell it to help with living expenses, including medical care you may need later in life. If you decide to keep your life insurance policy, update the beneficiaries to reflect your spouse’s passing.

Downsizing

Living alone comes with risks. A senior living alone is responsible for maintaining and financing an entire property, and the extra labor increases the risk of falling while home alone. Social isolation in itself is a health risk, with effects like increased risk of depression, stroke and cognitive decline. Many seniors benefit from moving to a lower-maintenance home near friends and family after a spouse’s death. While it’s difficult to leave a longtime home, maintaining safety and social connectedness is paramount. If moving isn’t an option, hired help such as house cleaners and personal care attendants can ease the burden of living alone.

When you’ve shared a life for years, it’s difficult to adjust to living and managing finances alone. It’s common for spouses to divide areas of expertise, but when one spouse passes, the surviving partner is left to fill in the gaps. If you’re struggling to answer these big questions alone, know that professional guidance is available.

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Funeral Planning

Will Your Death Put Your Family in Debt?

The cost for a traditional type funeral plan can be substantial, a major expense comparable to purchasing an automobile, furniture, or even a home, but it is the least researched purchase made by most consumers. Generally speaking, consumers look at talking about funeral planning prior to death as taboo, and this type of thinking can cause overspending and other problems, including how to pay for the funeral plan without running up debt they cannot afford to pay back. I advise consumers to look at funeral planning like any other financial investment and include it in their retirement savings plan. Funeral planning and how to pay for it should be included in financial planning matters and should be offered by financial planners to their clients.

If a death occurs suddenly and without warning, such as due to an accident, then a financial burden can occur within the family. When death occurs, many times family members want the best funeral plan available to honor their loved one, possibly never thinking about how it will be paid for. They pay the funeral director, cemetery or other facility with a credit card or other financing option; then the bills come due!

The death of a family member could cause a negative financial situation for the survivors if the deceased did not have any life insurance, death insurance or money in an account such as a Totten Trust which could help pay for funeral and final disposition expenses. This is why it is so important to become as educated as possible about the funeral planning process prior to a death.  Visit funeral homes, get price lists, visit cemeteries and mausoleums and get their price information, so you can be as educated as possible about making a funeral arrangement either at need (a death has occurred) or pre-need (a death has not occurred or is not even anticipated in the immediate future) and stay within your particular budget.

Generally the funeral home will want full payment at the time of death. Even if the deceased had a prepaid funeral plan, paying for it in monthly installments, if death occurs before all the payments have been made, they will usually be due in full at the time of death. So this can be a challenge for many families who do not have cash available to pay off the amount due.  Also, the deceased’s assets and accounts may not be available to the family until the estate has been settled.

There are many ways to save on the cost of funerals, including direct cremation options. Please check out my website, www.askthefuneralexpert.com, and my article “Frugal Funeral Planning” for tips and suggestions.

Have questions about funerals and funeral planning for both humans and pets? Contact Mike at mikeboyd@askthefuneralexpert.com.

 

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Financial Planning Should Include Funeral Education

Financial advisors are branching out!  They are even advising clients how to stay healthy, as your health can affect the cost of life and long term care insurance, and a prolonged illness can quickly eat up your savings.

Another important part of Financial Planning should be Funeral Education.  If you fail to learn the facts about this eventuality, it can end up costing you more and reducing the amount of money available to pass on to your heirs.  So start finding out about this important subject today!

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Why Talk About Funeral Planning?

Why are people afraid to talk about death and funerals?  They view the subject as either a taboo conversational subject, afraid of offending people, or they think of the funeral process as encompassing activities that are gross or disgusting (embalming, preservation of a body), or else they are afraid that speaking of death will somehow bring about misfortune.

But there is no reason to avoid this subject, and a very good reason to talk about it – because it can save you and your family money!  We are not afraid to talk about mammograms, prostate exams, or colonoscopies any more, even though those can be unpleasant subjects to talk or think about, because we have come to realize that they can save lives!  Well, talking about funerals, burials, and cremation can save money!  And it can also save stress and confusion at the time of a death.  All you need to do is to learn a little bit about the various products and services that are available, and that you will need to choose from, when purchasing a funeral arrangement for yourself or a loved one.

That is why I am starting this blog:  to help educate you, the consumer.  From time to time I will be bringing you easy-to-read information and money-saving tips.  Please let me know your thoughts, experiences, and questions.  Let’s start talking! 

Email your questions to mikeboyd@askthefuneralexpert.com or click on the  “Ask a Question” tab.

Copyright 2010 by Mike Boyd