Achieving Financial Well-Being After the Loss of a Spouse

By: Jan Paul Ferrer

 

Losing a spouse may be one of the most traumatic events you ever face in your lifetime. This devastating loss drains your emotions and makes it hard to focus on simple daily tasks, let alone fi nancial matters. But, fi nancial obligations are a fact of life—there are bills to be paid and decisions to be made. Taking an active role in understanding the key fi nancial issues you face can help you begin to implement a plan that will bring more confi dence and clarity to your life.

Your Journey to Financial Well-Being

Your new fi nancial reality can be intimidating, especially if your spouse was responsible for controlling your family fi nances. Suddenly, you are faced with an unfamiliar set of worries: Do I have enough income to maintain my lifestyle? Will I be able to stay in my house or will I need to sell it? What do I do about my spouse’s retirement account? Can I collect on my spouse’s Social Security benefi ts?

These questions can be overwhelming and confusing. Rather than tackling them all at once, start with these four important steps to begin your journey to fi nancial well-being:

1. Gather all your fi nancial documents.

This may include bank and brokerage statements, retirement statements, credit card statements, loan information, property titles, business agreements, tax returns and life insurance policies. If you have any joint accounts, begin retitling them, but consider keeping a joint checking account open for at least one year in the event you receive checks made payable to your spouse.

2. Prioritize your fi nancial obligations.

Pay the most important obligations fi rst. These typically include mortgage and car payments, taxes, utility bills and insurance premiums. If you’re not sure how much cash you have available, consider making minimum payments on credit cards until you have a budget in place.

3. Honor a ‘decision-free zone’.

While some fi nancial decisions require immediate attention, others can wait. Consider committing to a one-year ‘decision-free zone’ where you avoid making any major, irrevocable decisions that involve large investments, gifts to family members or charities, and your home. Instead, focus on paying the bills and running your household as you usually do. If you receive a large sum of money from an insurance policy, deposit it in the bank. This will give you the time you need to adjust to your new life and make more objective fi nancial decisions.

4. Create a plan and stick to it.

Determine your spending needs by tracking your household income and expenses for a few months. This will help you understand how much you will need to achieve your defi nition of fi nancial security.

Regaining your fi nancial balance after the loss of a spouse isn’t easy, but you don’t have to do it alone. It may be a good idea to surround yourself with a support team you can trust. An experienced team of advisors, including an accountant, estate attorney and a Financial Advisor, can help you make informed decisions and provide critical support during this diffi cult time.

Important Disclosures:

Article by Morgan Stanley and provided courtesy of Morgan Stanley Financial Advisor.

Jan Paul C. Ferrer is a Financial Advisor in Chicago, IL at Morgan Stanley Smith Barney LLC (“Morgan Stanley”). He can be reached by email at janpaul. ferrer@morganstanley.com or by telephone at 312 312-419-3535

This article has been prepared for informational purposes only. The information and data in the article has been obtained from sources outside of Morgan Stanley. Morgan Stanley makes no representations or guarantees as to the accuracy or completeness of the information or data from sources outside of Morgan Stanley. It does not provide individually tailored investment advice and has been prepared without regard to the individual fi nancial circumstances and objectives of persons who receive it. The strategies and/or investments discussed in this article may not be appropriate for all investors. Morgan Stanley recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a Financial Advisor. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives.

Morgan Stanley Smith Barney LLC (“Morgan Stanley”), its affi liates and Morgan Stanley Financial Advisors and Private Wealth Advisors do not provide tax or legal advice. Clients should consult their tax advisor for matters involving taxation and tax planning and their attorney for matters involving trust and estate planning and other legal matters.

Jan Paul C. Ferrer.may only transact business, follow-up with individualized responses, or render personalized investment advice for compensation, in states where [he/she] is registered or excluded or exempted from registration, https://advisor.morganstanley. com/janpaul.ferrer

© 2021 Morgan Stanley Smith Barney LLC. Member SIPC. CRC# 3052861 04/2021