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What not to do after losing a spouse or partner: A financial checklist

Updated
What not to do after losing a spouse or partner (John Slater via Getty Images)

Taking the vow “until death do us part” ushers in a life filled with love and joy. But when it comes time to part, losing a spouse or partner is among the most painful life experiences one can go through.

The weight of a loss can disrupt your life emotionally and financially. Recent findings from Ohio State researchers indicate that credit scores of surviving partners can fall by up to 10 points in the two years after a death.

As you take time to process your grief, there’s a handful of actions you’ll want to avoid to ensure you’re protecting yourself and organizing your financial well-being in the aftermath.

Grief is a natural feeling after losing a loved one, and it can be hard work, severely impacting your appetite, sleep, stress levels and overall health. It will be difficult to function or think clearly — or find answers to the questions you’ll inevitably have.

You might feel pressured to tackle everything on your own right away, but it’s wise to allow yourself grace and time to experience emotions and find stability before you address tough decisions.

Ask the people closest to you for help in making sure you eat healthy food, get enough sleep and exercise until you’re well enough to move forward. Grief therapy is also an option that can help you find coping strategies to deal with your loss. That support can put you in a better place to make decisions about your finances as you heal.

After losing a spouse, it might be difficult to remember everyday or routine tasks. That can make you vulnerable to missing housing payments or lapsing on essential insurance coverage like home, auto and health.

Enlist trusted family or friends to open your mail and categorize it into two piles — mail to immediately address and everything else that can wait — so that you can focus only on what’s most necessary in the earliest days.

To avoid falling behind on bills or harming your credit in the long term, set up autopay or alerts for your mortgage or rent, necessary utilities or insurance policies. If you rely on a physical calendar or daily planner, you can ask loved ones to put reminders there as well.

After your spouse or partner dies, you’ll need to contact the Social Security Administration as soon as you’re able to report the death. If you’re working with a funeral director, they can typically complete this process for you with your partner’s Social Security number. Otherwise, you, a family member or a friend must contact the SSA by phone at 800-772-1213 or in person at an SSA office. Unfortunately, it can’t be completed online.

Reporting the death to the SSA can trigger any benefits you’re eligible for. If you lived with your spouse at the time of their death, you’re typically entitled to a lump-sum death payment of $255. You may also qualify for survivor benefits that depend on your age, dependents and how much your partner paid into Social Security.

For example, if you are full retirement age or older, you might receive 100% of your spouse’s benefit amount, whereas if you’re caring for a dependent under age 16, no matter your age, you could be entitled to 75% of the benefit amount.

If your spouse received Social Security benefits at the time of their death, you’re required to return any payments received in the month of death or later. If payments are received as direct deposits, you or a loved one can contact your bank for guidance. If you receive physical checks, don’t cash them. Instead, return them to the SSA as soon as you’re able.

Contact the three major credit bureaus — Equifax, Experian and TransUnion — to request a “deceased alert” or credit freeze on your partner’s credit reports. This can help reduce identity theft in the interim of bureaus closing your spouse’s credit report.

After a spouse dies, you will need to deal with the financial accounts they’ve left behind. But you need to first make sure you’re entitled to access the accounts.

To access a bank account after a death, you must be a joint account holder, a named beneficiary or an executor of the estate. Even if you do have access to the accounts, you don’t want to do anything immediately.

“It is very important to not close all bank accounts that have your spouse's name on them,” says Matt Ahrens, a certified investment management analyst, partner and chief investment officer at MN Wealth Advisors. “It is very common to receive reimbursement checks or have credits issued after accounts are closed and all medical bills have been paid. These checks are issued in the name of the deceased individual, and without a bank account with their name on them, you will find it hard to cash them.”

Also avoid using your spouse’s credit card if it’s in their name only. If you use the credit card after they die — even if you’re an authorized user — the bureaus might consider it fraud.

Assets, liabilities and any belongings will need to be handled by the estate and may need to go through the probate process, depending on what documentation was in place before the death. Wait to access or make decisions about these accounts or items until everything is finalized.

When you’re in the depths of grief, you’re not in a place to make major purchases or decisions about your future. This can include getting rid of your partner’s clothing, moving out of the home you shared or making a major financial investment — any decision you might come to regret later.

“Losing a beloved partner is traumatic. You may feel like you are walking around in a fog for at least a year after his or her death,” says Regina McCann Hess, a certified financial planner, certified divorce financial analyst and author of Super Woman Wealth: How To Become Your Own Financial Hero. “While there are many tasks that you need to do, it is generally advised not to make any life-changing decisions in that first year. Examples of this could be moving or selling your home, changing careers or making large investments."

Waiting might provide the time needed for a more accurate picture of your finances. Give yourself space to experience emotions day by day, and if you feel there’s a big financial decision or purchase you absolutely must make, talk it over with a loved one for perspective and context.

Dealing with financial to-dos after losing a spouse can feel overwhelming, especially if you’re also experiencing a loss of income or don’t have the cushion life insurance might provide. But you don’t have to do it all by yourself. A trusted financial professional can help you navigate the paperwork, notifications and decisions necessary after a loved one dies.

“When advising a new widow on finances, I stress the importance of assembling a team of professionals to help navigate the complexities of the process successfully. First you need a road map,” says Melissa Murphy Pavone, CFP, CDFA and director of investments at Oppenheimer & Co. Inc.

That means getting the right people in your corner who can help untangle some of the more complicated issues of estate and tax planning.

Pavone advises the help of a certified financial planner, certified public accountant and estate planning attorney: “Together the team of professionals will address not only the financial considerations and tax implications, but ultimately optimize the outcome for the client's financial future.”

Dealing with the aftermath of losing your spouse requires a lot of attention and time. But what not to do financially after losing a spouse is forgetting about your own estate planning documents.

“You may have had your spouse as your beneficiary in your will, insurance products, investment accounts and retirement plans. You need to update your will and assign new beneficiaries for yourself,” says McCann Hess.

Make a list of banks, insurance providers, investment firms and any other financial services you do business with. That way, you’ll have a list to work down for contacting when you’re ready to confirm or update your beneficiaries. You also should update existing wills, trusts and powers of attorney.

There’s no way to prepare for the loss of a spouse or partner. Knowing the actionable steps you can take to manage your finances can be helpful, when you’re ready — or to hand off to trusted friends of family for help.

Jonathan Geserick, managing attorney at Texas Probate Pros, suggests starting with notification — and with the help of a professional. “The first thing that the surviving spouse needs to do is obtain copies of death certificates, at least 15 copies, from the funeral home or vital records office,” says Geserick. “Next, they need to locate the Will and any other estate planning documents (perhaps a trust). With those two things in hand, it is time to contact a probate attorney who will guide the surviving spouse through the probate process.”

✅ Here’s a checklist to reference when organizing your next steps:

  • Make copies of the death certificate

  • Gather any wills, estate and financial documents

  • Contact the appointed executor of the estate

  • Notify established beneficiaries

  • Plan funeral arrangements

  • Go through the claims process for life insurance policies or retirement benefits

  • Contact the Social Security Administration, IRS, DMV, Department of Veterans Affairs, your local election office and other necessary government agencies

  • Notify banks, credit card issuers, insurance companies, investment brokerages and other financial companies you do business with

  • Ask previous employers about policies, pensions or retirement accounts

  • Request a credit freeze with Equifax, Experian and TransUnion

  • File and pay any potential taxes

  • Create a new budget or financial plan

  • Remove your spouse from property titles and ownership documents

  • Update your own estate planning documents

Melanie Lockert is an L.A.-born and Brooklyn-based freelance writer with a decade of experience in personal finance. Melanie started the Dear Debt blog in 2013 and chronicled her journey out of $81,000 in student loan debt. She published a book of the same name in 2016. Her personal finance expertise has been featured on Fortune Recommends, CNN Underscored, Yahoo Finance and Business Insider, among other publications. She is also the host of the Mental Health and Wealth Show and cofounder of the Lola Retreat, a finance event for women.

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