Being Financially Prepared for the Unexpected Don’t be in the dark when it comes financial matters after a spouse’s death. Use these guidelines to help clear up confusion. BY RICK STASZAK
When a spouse dies, the last thing you want to think about is money, which is why being prepared is important.
Untimely deaths are unfortunately common and extremely frustrating for spouses who are left to navigate a sea of unfinished financial business. From retirement plans to insurance policies, far too many widows/widowers are thrust into the unwanted position of managing assets at the worst time of their life.
In addition to grieving, the unexpected death of a spouse can cause chaos and confusion to the surviving spouse and, at the same time, not permit them to see things as clearly as they normally would. It is also far too common for couples to not have a financial or estate plan in place and this leaves the surviving spouse uncertain about what to do with finances.
While in many cases it is impossible to foresee the death of a spouse, having an estate plan in place sets the groundwork necessary to effectively handle finances after a loved one’s death. Those left with assets following their spouse’s passing can breathe a sigh of relief when they realize an estate plan can manage the majority of those remaining assets.
Where There’s A Will (or Estate Plan), There’s A Way
The surviving spouse becomes financially vulnerable when he/she does not know where all the assets are managed (the different accounts, banks, advisors) or the investments and insurance policies they possess. They don’t know what they should do or where they should go to access money to pay estate taxes that are due within nine months of the death. Many turn to an attorney, which costs them a lot of time and money.
A few things the widow/widower should ask themselves: * Did my partner have a will or trust? * Who is the administrator or trustee of the will or trust? * How much am I going to have to pay an attorney? * What happens when I pass away and I want to make sure my children and grandchildren get all of my estate? How much will be left for my heirs after estate and income taxes? * What financial institution houses our financial/estate plan?
It is important that the surviving spouse deals only with a team of experienced professionals and avoid banks and high-priced lawyers. People should search for an experience Certified Estate Planner who can develop a solid estate plan with the help of an attorney. Now, on their own, they have to figure out whom they can trust to manage their estate and value their assets. Considering many surviving spouses are unaware of financial matters, they must be careful in choosing experienced professionals to assist them in a part of their lives that is fundamental to their future way of living.
Arrange Your Finances for Single Life Before You Become Single
No matter your net worth it is important to have an estate plan in place. Consider the below suggestions for creating a solid plan:
1. Take written inventory of your assets, asking yourself whom you would want to inherit each asset or handle each financial matter.
2. Clearly spell out your last wishes. In addition to a legal document, write a letter to your heirs describing your hopes for the family’s legacy.
3. Reflect on the potential worst-case scenarios that can result from the resolution of your estate. Be conscious of the unnecessary fees and commissions that can surface when settling an estate plan.
4. Lastly, make sure all important documents (financial, estate and personal papers) along with contact information for estate planner, advisors and attorneys are up-to-date and readily available.
Rick Staszak, RFC, CEP and ChFEBC, is a registered representative of securities and investment advisory services offered through Financial Network Investment Corporation, member SIPC, located at Foster Plaza 5, 651 Holiday Drive, Pittsburgh Pa. 15220. Staszak specializes in asset management, estate planning, investment strategies and overall wealth management. He helps individuals, as well as businesses throughout the country, acquire and retain wealth in a tax-efficient manner by providing customized financial plans/guidance and utilizing defensive investment strategies and investment tax management strategies. To contact Rick Staszak, call 412-928-4999 or 412-969-4409.