What to Do If You Survive Your Spouse: A Financial Checklist

The last thing you want to do after losing your partner is sit down to decide how life will go on without him/her. Yet, the world doesn’t stop—even when it feels like it has. While it’d be wonderful to stick your head in the sand until grief runs its course, you’ll likely need to make several important decisions in the aftermath of your spouse’s passing. Employing a checklist can help you navigate financial tasks while minimizing ill-advised, emotionally driven choices during this trying time.

Don’t rush into making big decisions

First and foremost, defer major financial decisions until you’re emotionally ready to address these: especially if nothing is pressing. While you may be tempted to rush into a hasty purchase or major upheaval, recognize that the devastating event that just occurred could inadvertently sway your decision. Whenever possible, recruit a professional or trusted family member to help manage the transition and act as a reality check.

Collect necessary documents

In the meantime, you’ll need to request multiple certified copies of your spouse’s death certificate (a minimum of ten but perhaps even more, depending on the complexity of the estate). You can request these from the funeral home or mortuary at the time of the death or a few months later through the county or state vital records office. You’ll need multiple death certificate copies to close accounts, file for benefits, and/or transfer ownership of the estate.

You’ll also need to get organized as you gather some important documents including your spouse’s will and other estate planning forms, birth and marriage certificates, Social Security card, insurance policies, old tax returns, motor vehicle titles, safe deposit box paperwork, bank statements, and anything else that might require updating. Beyond just paperwork, you may also need to check email and online accounts to make sure you aren’t missing anything.

Prioritize what needs to get done

Once you’ve collected all your documents, prioritize what needs to get done. While everyone’s situation is of course a bit different, items impacting your income may serve as your top priority. Such examples could include acting as a beneficiary of your spouse’s life insurance policy or receiving Social Security benefits.

Additional considerations

Life insurance
If you’re the beneficiary listed on a life insurance policy, contacting the insurer should rank as a top priority. At a minimum, you’ll need to file a claim and submit a certified copy of the death certificate. Once submitted, many states allow insurers 30 days to review the claim. Despite the absence of a set timeframe, most insurers (if approved) will pay the death benefit within 30 to 60 days of the claim date. Depending on your policy, you may have the option of receiving a lump-sum payment or installments and annuity options. These proceeds are typically not taxable, but any interest you may receive is (for example, if the money is held at the insurance company for a few months prior to transfer).

Credit Bureaus
Contact one of the three credit bureaus to notify them of your loss (once one is notified, they’ll notify the others). You’ll need to place a credit freeze on the account and then follow up by mail to request the account be flagged as “Deceased. Do Not Issue Credit.” Going through this process will minimize the risk of identity theft, and reaching out yourself is typically quicker than waiting for the Social Security Administration to notify the bureaus. This exercise will also help you obtain a copy of your spouse’s report, which will tell you what debt, if any, he or she left behind. You can find various sample notification letters via a quick online search.

Social Security benefits
If your spouse was collecting Social Security at the time of his or her death, contact the Social Security Administration. There are several reasons why it’s important to do so.

First, when one spouse dies before the other, the surviving spouse can take what’s called a survivor benefit: allowing the surviving spouse to collect his/her check or the check of the deceased—whichever is higher—regardless of whether the surviving spouse has earned enough credits. While the monthly benefit is reduced if taken at an early age, widows can begin taking benefits at the age of 60 (at age 50, if disabled) rather than waiting until age 62.

Notifying Social Security will also trigger a one-time lump-sum death benefit of $255 to the surviving spouse and terminate your spouse’s monthly benefits, beginning with the month of death. Finally, if you have minor children, you may also qualify for additional benefits.

Inherited IRAs
If you’re inheriting an IRA, this can provide a significant boost to your financial situation. However, laws surrounding the same are sometimes very complicated: making mistakes involving these types of investments often very costly. Click here to read more about inherited IRAs.

Spouse’s employer and other accounts
Your spouse’s employer will need to know where to send any monies due, while you can inquire about any benefits or life insurance policies you may be entitled to. While this may seem trivial, you’ll also need to cancel any gym, club, magazine, or other memberships/subscriptions your spouse had to prevent future charges.

About joint accounts

As emotionally taxing as it may be, you will also need to eventually extricate your spouse from joint accounts. For example, jointly owned assets such as cars or houses must be retitled, and bank accounts and any insurance policies you shared will need to be placed in your name or closed. However, consider leaving shared checking accounts open for a while (if possible) to receive any direct deposits your spouse had set up.

In sum: what to do if you survive your spouse

Trying to disentangle your spouse’s finances following his or her departure is often a difficult process. Yet, a financial misstep can make life as a new widow(er) even more brutal to bear. That’s why it’s so important to have a game plan for processing your spouse’s estate, saving you a lot of extra grief in the long run.

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Vision Retirement is an independent registered advisor (RIA) firm headquartered in Ridgewood, New Jersey. Launched in 2006 to better help people prepare for retirement and feel more confident in their decision-making, our firm’s mission is to provide clients with clarity and guidance so they can enjoy a comfortable and stress-free retirement. To schedule a no-obligation consultation with one of our financial advisors, please click here.

Disclosures:
This document is a summary only and not intended to provide specific advice or recommendations for any individual.  Vision Retirement does not provide legal advice.  Please consult your attorney regarding your specific situation.