The death of a spouse is something that no one wants to think about.  Whether you are 35 or 85, the thought of suddenly being single again is frightening.  When it happens, it can be devastating to the surviving partner.  What should you do and, importantly, what shouldn’t you do in the next few days, weeks and months?  Over the lifetime of our practice we have seen countless individuals in this transition and come up with a checklist of items to consider.

1. Funeral Planning

Among the immediate needs is planning for the funeral. If possible, tap a family member or close friend to assist with this.  There are many decisions to be made that will be stressful and it is wise to gather support in advance.  Was the deceased an organ donor?  This information is often found on their driver’s license or living will.  Some people specify how they want their last wishes handled in an Advanced Directive.  Be sure to check these documents before making decisions.

2. Assemble a Financial Support Group

We recommend that this consist of your trusted advisors – lawyer, accountant and financial planner or investment advisor. These professionals should be able to assist you with triaging the settlement of the estate and provide you with guidance moving forward.  Don’t make major financial decisions rashly such as putting your house on the market, giving away money or buying financial products like annuities or life insurance.  The estate will need to be settled within nine months of the date of death, so it is wise to harness the expertise of this team early in the process.

3. Gather Your Documents

You need to pull together a lot of documentation – both paper and electronic. Organize by broad categories such as banking, bills, taxes, life insurance and estate documents. You will need at least 5-10 copies of the death certificate (typically provided by the funeral director).  Other information that you may require includes Social Security numbers, birth and marriage certificates, military discharge papers, powers of attorney, car titles, company benefit booklets, and statements from all financial accounts.  Some of these documents may be in a safety deposit box; if the spouse has a key to this, we generally advise removing the contents promptly.

4. File Life Insurance Claims

Proceeds from life insurance are usually paid promptly – typically within 30 days. This liquidity can be very useful for paying funeral costs, hospital bills, and attorney’s fees for settling the estate.  Don’t overlook life insurance benefits that the decedent may have had from current and previous employers.  We recommend putting the proceeds from life insurance in a savings account for safe keeping for 3-6 months or until you decide how much you need for immediate cash flow, the payment of final expenses and what can be safely invested.

5. Notify Social Security

If the funeral director has not already done so, you will need to notify social security. The widow or widower is entitled to 100% of the deceased spouse’s benefit at full retirement age.  If you were already collecting a spousal benefit you can “step up” to a survivor benefit.  Any Social Security checks received after the decedent’s death may need to be returned to the government.  The surviving spouse is eligible for a one-time payment of $255 as a death benefit.

6. Close Accounts

Any accounts that were in the decedent’s individual name such as credit cards will need to be closed. Cancel their driver’s license and any memberships in organizations.  Terminate any email, social media and website accounts.  To minimize the chance of identity theft you may also wish to notify the credit reporting agencies: Equifax, Transunion and Experian.  Note: if you have a joint bank account you may wish to delay notifying the bank for a year to allow for the deposit of any odd checks that come in under the decedent’s name.

7. Contact Their Employer

If your spouse was still working at the time of death, contact their employer regarding any benefits that might be due to you including life insurance, unpaid salary and bonuses, accrued vacation pay, funds in a flexible spending account, stock options and pension. If the family had health insurance through the spouse’s employer plan, then you may be eligible for COBRA coverage (for 36 months).

8. Retitling of Real Estate Assets

Review your real estate holdings to see if they need to be retitled from Joint Tenants to sole ownership. Your attorney can prepare the documents for this and discuss the possible advantage of other ownership options such as trusts or life estates to ensure a smooth transition going forward.

9. Beneficiary Claims

File beneficiary claims for the decedent’s IRA’s and retirement plans. If the spouse is the sole beneficiary, it can be rolled into their own IRA.  However, if the spouse is younger than 59 ½ and needs to tap the account for living expenses it may be better to open a Beneficiary IRA.  Seeking the counsel of a CFP® can help avoid costly mistakes.  If the decedent was 70 ½ or older, it is important to see if their required minimum distribution was taken in the year of death before they passed.

10. Revise Your Own Estate Plan

Your beneficiaries, wills and powers of attorney, and healthcare directives may need to be updated.  Most likely, your spouse was listed as the go-to person for your affairs.  With their passing, you may need to revisit your own estate plans and make changes.  After the dust settles, see your estate attorney to discuss and make the appropriate revisions.  Be sure to follow up with your financial planner to make sure that these changes are implemented across your accounts.

11. Assess Your Cash Flow

Make a list of your income from all sources: Social Security, wages, IRA distributions, dividends and interest, and pension. Some of these may have changed since the death of your spouse.  Next, assess your fixed expenses that will need to be paid going forward such as mortgage payments or rent, utilities, insurance, and groceries.  Finally, make a list of your discretionary expenses like entertainment, travel, gifts, and clothing.  Your check register and credit card bills are good sources of information on current spending.  A CERTIFIED FINANCIAL PLANNER™ can help you work through any shortfalls and make a plan for the years ahead.