By Katlego Mei, CFP ®

Moving forward financially after the death of a spouse can be a daunting task. Especially during a time of grief and emotional turmoil. It was challenging for my mum. Fortunately, my dad had structured his affairs relatively simply and ensured she was cared for. She also had emotional support from her sons and other family members. Taking proactive steps to manage your finances after losing your spouse can help ensure stability and security for your future. Here are a few steps to help you navigate this challenging period:

Understanding the Immediate Financial Impact

When a spouse passes away, the household income often changes significantly. This could mean a reduction in income if your spouse was a primary breadwinner, or it might involve managing new sources of income, such as life insurance payouts or inheritance. It’s crucial to assess your financial situation quickly to avoid missing payments or accumulating debt.

Key Immediate Tasks

Gather Essential Documents: Obtain certified copies of your spouse’s identity document and death certificate, as these will be required for various financial and legal transactions. Collect as much information as possible. This includes bank statements, policy schedules, investment statements, tax returns, and any other relevant financial documents to understand your financial landscape. It helps if each individual keeps and maintains a life file so that the information is readily available for the surviving spouse. It can be a physical or digital file.

Notify Financial Institutions and Authorities: Inform banks and other financial institutions about your spouse’s passing. This will help prevent unauthorised transactions and ensure that accounts are updated accordingly. Alert your spouse’s financial planner and lawyer. They will be able to guide you through the next steps.

Manage Household Bills: Take over the responsibility of paying bills, especially those previously managed by your spouse. In my parents’ case, my dad used to cover most of the household bills, so this part was a big adjustment for her. The most important thing is to draft a new budget to ensure that payments are made on time to avoid late fees or service disruptions. Adjust your spending based on your new financial situation. This might involve reducing non-essential expenses to cover essential costs while you wait for payouts from your spouse’s investments/policies and for the winding up of their estate to be completed.

Emotional Support and Self-Care

While managing finances is crucial, don’t forget the importance of emotional support and self-care during this challenging time. Surround yourself with trusted friends, family, or support groups who can offer both emotional and practical assistance. Go for counselling if you need to and take the time you need to heal.

Planning for the Long Term

As you navigate the grieving process, it’s essential to start thinking about long-term financial planning. This involves reassessing your financial goals and adjusting your strategy to align with your new circumstances.

Review Your Will and Your Estate Plan: Check all accounts, insurance policies, and retirement plans to update beneficiaries if necessary. This ensures that assets are distributed according to your current wishes. Also, reassess the level of insurance cover you have in place to ensure that you and your dependents are sufficiently covered. Review and update your will, power of attorney, and other estate planning documents to reflect your current wishes.

Re-evaluate Financial Goals: Consider how your financial objectives may have changed. This could involve adjusting retirement plans, investment strategies, or savings goals. Once you have a stable financial foundation, consider investing to grow your wealth over time. Ensure that any investments align with your risk tolerance and long-term goals.

Consult Your Financial Planner: Your financial planner can provide valuable guidance on managing your assets effectively, structuring your estate plan and making informed decisions.

Moving forward financially after the death of a spouse requires patience, planning, and support. Remember, it’s okay to take your time and prioritise your emotional well-being as you work towards securing your financial future.

Read more from Katlego Mei here.