7 practical steps to dealing with finances after the death of a spouse

Losing your spouse or partner is one of the most difficult things to face in life.

The emotional aspect of dealing with a bereavement can be devastating and you may find thinking about the practicalities of what to do next stressful and overwhelming.

While money is the last thing you want to think about, it is not something you can put off forever and you might not be able to delegate every task necessary to someone else. If you are struggling to know where to start, it can be useful to seek professional advice.

This article includes some practical things you will need to do, along with some suggestions to help you cope with the upheaval.

1. Look after yourself and enlist help if you need it

This is perhaps one of the most vulnerable times in your life. Waves of grief can hit at any moment, adding to the challenge of taking care of finances. So, enlist someone you trust to help, maybe a relative or a close friend.

As well as helping you to sort out the financial paperwork, ask them to sit in with you at any official meetings.

This is one of the times in your life when you are potentially vulnerable. Even if you have dealt with your financial planner or other professional advisers for years, having someone else present is often recommended for your own protection, as well as to help make sense of everything.

When you feel ready to sit down with a financial planner, you should make time to do so. However, it is essential that you only do this when you feel up to it.

Don’t feel pressured into making any big decisions. You can meet with your professional advisers as many times as you need to make the right choices.

2. Understand the estate

If you had Power of Attorney or managed your finances as a couple, you will probably have a clear picture of how the estate is put together.

Alternatively, your partner may have been organised and left you with a folder or filing cabinet with all the information you will need to look after the estate.

If not, don’t worry. Take time to check through any paperwork for details of who they dealt with for banking and other matters. A starting point could be a debit or credit card in their purse or wallet, a bank statement, a utility bill or even a memory of going to a certain bank or building society.

3. Focus on the most pressing, routine financial decisions

There is no need to tackle everything in one go. Instead, try to schedule a small chunk of time each day to devote to urgent financial tasks. Completing one task a day will give you a semblance of order and can be empowering.

Don’t expect too much of yourself. Just focus on immediate needs, claim benefits and pensions, settle the estate, pay any taxes and work out what cash flow you will need going forward.

4. Be sure the bills are paid

Make bills a priority, otherwise you could face late payment fees or even debt collection for missed payments if you let things wait too long.

First, get on top of the household bills. Gather all the bills and make a note of how much is due and when they must be paid. Then check your bank account(s) to make sure you have enough money to cover everything.

If you decide to keep the joint account, any bills paid by direct debit from your joint account can continue as normal.

Bills that were paid from your partner’s individual account, however, might not get paid. This is because the account will probably be frozen once the bank learns of the account holder’s death.

You will need to contact the companies to change the payment details so that the money is taken from your account instead.

For bills that will continue to arrive, you will need to change any that were solely in your partner’s name to your name. Any bills that were in both names you can switch to your name only, but there is no rush to decide or act on this in the short term.

5. Transfer your joint bank account to an individual account

If you had a joint bank account with your partner, you can continue to use it as normal.

When you are ready, you will need to tell the bank or building society that your partner has died, so that they can amend the account details.

Alternatively, you might want to change it into an individual account in your name. Doing this may make it easier to manage your money.

6. Draw up a new budget

It is likely that your household income will change or possibly even drop when your partner dies.

With your household bills organised, you should have some vision of your regular monthly outgoings. So, you have already made the first steps towards drawing up a new budget.

Next, you need to add up all your regular income. This could come from benefits, a pension, wages, investment income or even savings.

If you end up with income left over after you have paid the bills, you might want to consider saving to build an emergency fund.

Should you already have an emergency fund, consider putting any additional money into a high- interest savings account. That way, it can earn some interest while you are still grieving. You can decide how to invest or spend any extra cash when you are ready.

7. Don’t rush into any big decisions

It is very important, in those first few months, that you avoid making any big decisions until you feel able to.

There is no need to rush into making big life changes. You may think you want to sell your house and move somewhere smaller or invest a life insurance pay out in a new property, but these life-changing decisions can wait.

Most financial planners would suggest you wait to invest lump sum insurance or pension pay outs for at least six months or longer.

Also, watch out for unscrupulous people trying to get you to invest with them, too. There will always be unsavoury characters who prey on the vulnerable, so exercise extreme caution if anyone approaches you with business or investment “opportunities”.

Get in touch

When you are ready, you might wish to re-establish your goals and objectives, as well as other needs, charitable giving and any gifting you may wish to do. Just remember not to rush anything.

If you wish to speak to one of our financial planners for help in organising your finances or any other aspects of financial planning, we are here to help however we can. Get in touch by emailing enquiries@bowmorefp.com or call us on 01275 462 469.

This article is for information only. Please do not act based on anything you might read in this article.

Bowmore Financial Planning Ltd is authorised and regulated by the FCA.

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