The love between couples is expressed in many ways. It may be as deeply profound as the emotional support provided during difficult times or as intimate as a kind word or gesture when least expected. What is often overlooked as an expression of love for a partner is estate planning for the day when one partner dies. With an average life expectancy of 79, a surviving spouse may live up to 20 years or more solely responsible for managing money on their own; in fact, half of all American women who are widowed became so before the age of 59.¹

With both men and women carrying household finances in these modern times, it is a supreme act of negligence when the more financially sophisticated spouse does not prepare their loved one for the time when financial responsibilities fall on the shoulders of the less knowledgeable, surviving spouse.

This is something few couples want to think about, much less discuss—which is where a trusted financial advisor can play a crucial role in educating their clients.

Steps to Take Today

Here are some important actions your clients can take to financially prepare their spouses for a future without them.

1. Prepare a list of all financial accounts, including contact numbers, usernames and passwords. This list should also include mention of any safe deposit boxes, location of important legal documents (e.g., will, deeds) and storage spaces that may contain valuable property. This list should be regularly updated and shared with the spouse.
2. Include the spouse on meetings with financial and other advisors. In this way, they can learn about why certain financial and other related decisions were made and participate in future ones. Advisors can help with this by encouraging such participation at quarterly reviews.
3. If the client is a business owner, make sure there is a succession plan. This may include key person insurance to buy out the deceased partner’s share so the surviving spouse is not left running a business for which they do not have the skill or interest, or is burdened by the need to negotiate a buy-out of an inherited interest.
4. Create trusts that may relieve the surviving spouse of the financial and investment management burden.

Aside from the value of getting involved in helping clients on these matters, financial advisors also have a self-interest in doing so. For example, 80% of widows switch advisors within the first year of a spouse’s death; therefore, it may be the best way to protect against asset leakage arising from the death of a partner.²

Sources:

1. https://www.cnbc.com/2021/11/22/op-ed-recent-widows-need-financial-guidance-after-a-spouses-death.html

Please reference disclosures: https://blog-dev.americanportfolios.com/disclosures/