Death and Pitfalls

01 October 2011

OK, this is not a pleasant subject, but when I was running through the financial section of Yahoo! I saw an article on the stresses placed on a surviving spouse and what to do and not to do. The period after a spouse's death is a stressful time filled with sadness and tasks that require immediate action. However, this is not the time to make major financial decisions. The following are just a few dos and don'ts to keep in mind when making financial decisions after the death of a spouse.

Don't:

• Sell your house.
• Give money to charities.
• Give money to your children.
• Sell stocks, bonds or mutual funds.
• Move in with a child.
• Buy an annuity.
• Buy life insurance.
• Change your checking account, since you may receive checks with the deceased spouse's name and need a place to deposit that check.

You can address these issues when you are able to deal with and attend to details.

Do:

• Meet with your estate lawyer.
• Pay the mortgage and everyday bills.
• Notify the Social Security Administration of your spouse's death.
• Notify Medicare and other insurance companies that your spouse has died.
• Check for any pension benefits.
• Order death certificates.
• Gather birth certificate, marriage certificate and military discharge papers.
• Gather statements for retirement accounts, banks, brokerage accounts, and mutual funds.
• Make a claim for any life insurance.
• Call your spouse's employer and speak with human resources to see what benefits there may be for a surviving spouse.

If you are the beneficiary of an IRA or retirement plan, don't automatically roll it over into your own IRA. Seek advice―you have options.

Get help. Speak with your trusted advisor(s), such as CPA, lawyer or financial advisor. Someone who is aware of your financial situation will be better able to offer sage advice. A surviving spouse is often left vulnerable. Be wary of the ambulance chasers and when in doubt, wait.

This material is not intended as tax or legal advice. We make no representation as to its accuracy or completeness. Information is provided for informational purposes only. Please consult your tax and legal advisors regarding your individual situation.