Losing a spouse is one of the most stressful things a person can experience. In fact, a study published in the American Journal of Public Health found that mortality rates in the bereaved can be up to 150 percent higher than in the general population due to stress. Unfortunately, financial problems start to pile up at a rapid pace during this time, which is the last thing your loved one needs. Naturally, you want to help out, but you may not know where to start -- here are a few things you can do.
Don’t Rush into It
Encourage your loved one not to make any major financial decisions in the early stages. Grief can cloud your thinking, so start with just the basics -- firstly, can you get enough cash together to pay for the funeral expenses? This can be tricky, because power of attorney rights are nullified upon death, meaning survivors are sometimes not able to access money held in their partner’s name. US News has some good advice here on how to pay for a funeral when the cash flow is limited. Next, get the death certificate, because you will need this for several processes in the future, such as when making a claim on life insurance.
Get a Basic Overview
One of the major causes of stress regarding finances during bereavement is uncertainty. Because of the complexity of many people’s financial affairs, it can be tricky to know where you stand. Getting a basic overview can help. Start by making a simple balance sheet -- put assets like house value, bank account balances, and investment valuations in one column, and debts like your loans and mortgages in another. Sum both columns and subtract your debts from your assets -- you now know roughly what you have available. It can also be useful to write down how accessible each of your assets is right now -- in other words, how liquid you are. This will help you determine how well you’ll be able to meet immediate expenses.
Get an Advisor
The immediate grieving period is naturally the worst, and the stress can seriously knock a person’s self-confidence. According to a survey published in the Journal of Financial Service Professionals, this can carry across to financial matters, particularly in women. Sorting out these financial affairs can be a mess when you factor in Social Security payments, insurance, power of attorney, obtaining the death certificate, and a host of other matters. If you’re not confident in dealing with all this, it might be wise to seek out a certified, reputable financial advisor. That same study found that widows who did so saw a significant boost in their confidence regarding their financial situation.
After a little time, discuss with your loved one their potential need to downsize. Moving to a smaller place can free up a lot of money, which might be necessary to pay for medical costs, clear some debt, or cover other expenses. It might also be harder to manage the day-to-day chores in their current place, which were previously shared by two people. On the other hand, moving can break social ties, and social support can be very important in helping people adjust to a loss. If you are considering downsizing, look up house prices in your area, and try to find homes close by which are comparable in size. This will give you an idea of what your home is worth right now -- but if you can’t find a good comparison house, ask a realtor for more advice.
It’s a sad irony that these financial matters pile up right when we’re least able to deal with them. A little extra support from you in this area will likely be very much appreciated by your loved one. Just take your time, plan ahead, and don’t be afraid to seek help yourself if you are struggling.
by Lucille Rosetti
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