Create a financial roadmap before your spouse dies

I don’t even know where to begin,” Cindy Steinberg told me after her husband’s death. “I’m just trying to stay on top of the bill. I don’t even know all the passwords to bank accounts and investments.”

I heard this repeated from all the recent widows – and widowers – I’ve spoken to. While the family is in deep grief and mourning, life around them goes on. And keeping up with it all can be overwhelming.

Steenberg’s husband, Steve, died at age 62 after a brief illness, leaving her not only to deal with overwhelming grief, but also bewildered and bewildered by the complexities of how their finances were handled.

“Steve was meticulous about how he organized it all,” Cindy said. “He organized everything and managed the day-to-day business of our lives and also the strategy for our future.”

Like most families, the Steinbergs of Connecticut settled into separate roles, with Steve responsible for all of the family’s finances.

Picking up the family financial pieces

Running a family is like running a business. There is income and there are also expenses. There are investments and accounts to keep track of and bills to pay. Although housekeeping tasks are sometimes shared, often there is a chief operating officer, or COO, who keeps it all humming along smoothly.

Unfortunately, and all too often, when a spouse dies prematurely, the surviving spouse is put in the unenviable position of picking up the pieces without knowing much about the family’s finances – not even the basics of how their bills are paid.

I am personally well aware of the fragility of life, having seen friends leave us through illness or accident. So I’m embarrassed to admit that this shoemaker’s children don’t have shoes: I’m in charge of my family’s administrative and business life, but haven’t shared enough with my wife or heirs to ensure a smooth transition to the new COO. If the saying just hits me.

Gabe Caponetto, a certified financial planner with UBS’s Alpha Legacy Wealth Management Group in Red Bank, NJ, emphasizes the importance of creating a roadmap that “connects all aspects of your financial life.”

The scheme provides security

He also points out that “having a plan in place will give both individuals a sense of security that their financial lives are in order.” Caponetto sees that aspect as key to reducing anxiety when a spouse dies.

Cindy Steinberg, now 64, knew she would eventually be financially well off, but not knowing the daily tasks she had to do left her with late payment notices and administrative hurdles that added to the stress she was already experiencing. increased.

Caponetto likes to think of his role as a quarterback, guiding play for families.

“By knowing who all the advisors are in a client’s life — what I call ‘centers of influence’ including financial advisors, CPAs, tax preparers and attorneys — my client can make one phone call and handle the quarterback. ,” he said.

The plan he advises clients to create will keep track of assets and liabilities, sources of income, expenses, estate plans and accounts, and how assets are titled. “And,” he adds, “the great thing about a plan is that once you start it, you can constantly update it as your life changes.”

8 Tips for Transitioning to a New COO

1.  Access  . Ensure that all user IDs and passwords are accessible. Keep an up-to-date list on your password-protected phone or computer, or on a piece of paper in a locked safe. As long as the new COO knows the phone password and the combination for the safe, they are easy and safe ways. Be sure to also keep the partner’s email account active so that notifications can still be received.

For some assets that have value but may not have monetary value, such as frequent flyer miles and points, the survivor can continue to use them by accessing the account online.

2.  Sharing Accounts  . Make sure both parties have legal access to accounts or safe deposit boxes if one person dies. This may require changing ownership of some. For accounts with significant assets, consult an attorney to ensure ownership is best set up.

3.  Automation  Arrange for recurring bills such as mortgage/rent and loans, credit cards and utility bills to be automatically generated directly from your bank account every month. And make sure the account has both parties’ names. Make a list of all recurring bills you have and how they are paid, ie through a manual process or through automatic withdrawals or credit card payments.

4.  Experience  . Sit down with your partner and pay the bills together for a month or two. This will be an invaluable exercise and will not only help with the transition later but possibly streamline the current process as many times we do what we have done, even if there are better ways.

5.  Prior Arrangements  In the midst of grief, the last thing mourners want to deal with is deciding what to do with the body or what kind of service or memorial they want. As the COO of your family, make sure the incoming COO knows exactly what you want to do after you die and what arrangements have already been made.

6.  Short term planning  . Prepare a simple, approximate budget for the next two or three months and share it with your partner. Often discretionary vs. clear road spending. is to be divided into non-discretionary so if the incoming COO sees a shortfall, he can easily determine where to make cuts.

7.  Long term planning for the year  If there are large expenses that will occur at the end of the year, such as taxes or insurance, or anticipated income such as bonuses, make sure the budget notes them. If possible and practical, the current COO can keep or record where the funds will come from to pay for the next big expense.

8.  Long term planning  If you have a financial advisor, broker, attorney, or tax advisor, each should have contact information for the others. It is imperative that everything is set up for a smooth and legal transition of assets when one partner dies.

Goals and plans will likely change later but knowing the original plan and advisors will make the transition easier. Once the dust settles, the new COO can review goals and plans with consultants to ensure they reflect current needs.

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