Blog | 5 P’s of Life
As you age, there’s a risk you may outlive your spouse. It’s a situation you may not want to think about, but it’s important to discuss with your spouse before something happens.
While life expectancy for men and women has increased over the years, there are uncontrollable events and hereditary health issues that may cause your spouse to die before you.
Do you know what to do if your spouse dies before you?
Here are five items to discuss with your spouse before something happens.
1- Professional Contacts
If you become a surviving spouse, you’ll need a team of qualified experts to guide you through decisions. While family and friends may have good intentions, they may not be aware of your legal documents and financial situation.
You’ll need to know the name and contact information for your estate planning attorney, tax advisor, and Certified Financial Planner™. Make time to meet these individuals and continue being present during review meetings.
2- Financial Accounts
One of the first things you’ll need to do as a surviving spouse is to contact all financial institutions that hold your assets. These assets could be in checking, savings, money market, and/or brokerage accounts.
The reason this step is important is to make sure you have access to money to pay bills. Verify with your spouse that the accounts are correctly titled to give you authorization.
Most financial institutions have their own Power of Attorney documents. Also, some accounts should be titled “Transfer on Death” or “Joint Tenants With Right of Survivorship.”
3- Important Documents
Know where to find all important documents such as your spouse’s Will, Trust, other estate planning documents, and life insurance policies. Also, spend time understanding what these documents mean.
For example, with a Trust, know which assets are in it and who is named as the Trustee. For each life insurance policy, know whom to contact and how payment is made to the beneficiary.
4- Assets and Liabilities
Keep a master list of all assets and liabilities, including their value and the name on the asset/liability. If something happens to your spouse, know whom to contact for each one.
Assets include personal property, financial accounts, real estate, vehicles, stock options, business interests, cash value of life insurance policies, retirement accounts, and any other item with value.
Discuss what will happen to these assets if you become a surviving spouse, especially if your spouse owns a business or was previously married.
For liabilities, include mortgages, line of credit, credit card debt, vehicle loans, back taxes, and any other type of loan. Also, include regular financial obligations such as household expenses and club memberships.
Discuss the amount of outstanding balance and when payments are due.
Having this information current and easily accessible will help you know what you own and what you owe.
5- Health Insurance
If your health insurance is from your spouse’s employer, know your options if you become a surviving spouse. These changes may impact how much you pay for premiums, deductibles, and out of pocket expenses. Check your medical, dental, vision, and long-term care insurance policies.
If you’ve been involved with your household finances, you may be aware of some of this information. If you haven’t been involved, become involved.
It may be confusing the first time you review this information. But over time, you’ll have a more comfortable grasp of the information.
ABOUT THE AUTHOR:
Niv Persaud, CFP®, CDFA™, RICP®, CRPC®, is the Founder of Transition Planning & Guidance, LLC. Life is more than money. It’s about living the lifestyle you want and can afford. For that reason, Niv consults with clients on money, life, and work. Her approach capitalizes on techniques she learned throughout her career, including as a management consultant, executive recruiter, and financial advisor. Her services include developing spending plans, comprehensive financial plans, divorce financial reviews, retirement plans. Niv actively gives back to her community through her volunteer efforts. She believes in living life to the fullest by cherishing friendships, enjoying the beauty of nature and laughing often — even at herself. Her favorite quote is by Erma Bombeck, “When I stand before God at the end of my life, I would hope that I would not have a single bit of talent left and could say ‘I used everything you gave me.’”
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