“In this world, nothing is certain except death and taxes.”

You’ve likely heard this famous quote from Benjamin Franklin, written in a letter to a friend as he neared the end of his life. Death is indeed a certainty for each of us, and this knowledge can make it easier to prepare for the end of life, including having a financial plan in place to protect and preserve your wealth for your loved ones.

While you may have contemplated getting your affairs in order before your own passing, what about those of your spouse? If you’re the surviving partner, the financial burdens placed on you can be significant. 

With the passing of a loved one, it can feel impossible to make important decisions, especially those concerning money. It’s important to understand the costs that you may shoulder with the loss of your spouse, as well as how to prepare financially, so you’re not left to deal with it during a time of grief.

Completing a financial planning checklist for death is likely not the most lighthearted task you’ll complete, but it’s something you’ll be thankful you sorted out ahead of time. 

Understand The Costs of Your Spouse’s Passing 

When your spouse passes away, there will be the expected final arrangements that need to be made, which can include a funeral and burial. 

According to the National Funeral Directors Association, the median price for a traditional funeral and burial in 2023 was $9,995. However, this is only an average cost and may not include additional expenses such as a burial plot or transportation of the body, if your spouse wishes to be buried in a different state than where you reside. 

You and your spouse should know each other’s wishes concerning final arrangements. Consider exploring all the options that are currently available together: You or your spouse may want to consider alternative arrangements, such as a green funeral, cremation, or a celebration of life instead of a traditional funeral. 

Know the Process of Settling an Estate

Settling your spouse’s estate can take money and time; estate planning is essential to ensure this process goes smoothly and that your spouse’s legacy is protected.

All property that is jointly held with rights of survivorship should immediately pass to the surviving spouse without probate. Any assets that are held in a trust or have a payable-on-death beneficiary should also circumvent the need for probate. However, there may be other assets that necessitate probate and its associated costs, legal fees, and/or executor fees. 

After your spouse passes, the estate must settle their outstanding debts and obligations. These debts are typically paid out of the money or property left in the estate. As the surviving spouse, you’re usually not responsible for these debts unless you share legal liability for them, such as if it was a joint account or you were a co-signer.

Be Prepared with an Estate Plan 

Having an estate plan in place for you and your spouse long before you need it will spare each of you from the burden of arranging financial affairs after death. As part of a comprehensive estate plan, there are several legal documents to prepare:

  • Will
  • Trusts
  • Power of attorney
  • Medical directives
  • Life insurance policies (each spouse should know coverage, benefits, and issuer information)
  • Usernames and passwords to all financial accounts
  • Pension information (including survivorship benefits and related information)

Look over these documents regularly to ensure they contain up-to-date information. Keep them in a secure place in your home — not in a lock box or safety deposit box, as your loved ones may not have immediate access when they’re making final arrangements. Make sure your spouse, as well as at least one other trusted individual, knows the location of your documents. 

Review Long-Term Care Options

It’s important to also consider your options if your spouse needs extended medical care before their passing. The cost of care can quickly add up, and preparing for this uncertainty can help insulate your finances from major medical expenses.

Long-term care insurance policies can help protect your wealth from the impact of prolonged medical care. You’ll need to decide whether hiring a skilled in-home nurse or getting help from family members will be a better option for care. It can be a difficult discussion, but it’s important to review with your spouse how to plan for extended healthcare costs well before you’re faced with them. 

Assess Insurance Needs

If you obtain health insurance through your spouse’s employer, things can get complicated — and potentially costly — if they pass away. 

While your spouse’s death will trigger your eligibility for COBRA, these premiums can be expensive, and eligibility only extends for 36 months. When investigating new options, weigh your personal health needs with cost-saving options such as a high-deductible plan with an HSA. 

In addition to your health insurance, you may want to re-evaluate your life insurance arrangements with your spouse’s passing. If your children are already grown and no longer dependent on your support, you may not need as much life insurance. You may also need to take out your own policy if you held a life insurance policy with your spouse’s employer.

Recognize Other Potential Expenses

Beyond the direct costs associated with your loved one’s passing, there can be additional, less evident expenses that you may potentially face: 

  • You may want or need to take an extended leave of absence to grieve your spouse or give yourself time to be with family. This could impact your income and retirement savings if you’re still working.
  • You may want to see a therapist or grief counselor to help you process the death of your spouse. This can be an extended expense if not fully covered by insurance.
  • If your spouse was the one who managed the housework, yard work, or finances, it may be necessary to outsource these services to professionals if you don’t have the bandwidth to deal with them yourself.
  • If you decide to downsize and sell your home or move in with a family member, you may need to pay a real estate agent to sell your property, as well as other fees associated with the sale and moving expenses. 

You likely won’t anticipate all the indirect costs of a spouse’s death, but acknowledging that there can be additional expenses will help you be better prepared.

Consider Help in Your Estate and Financial Planning for Death

Preparing and financial planning for the death of a spouse can make all the difference when that difficult time comes. Because death evokes such strong emotions, even when it’s a long way off, it may be helpful to involve a financial professional to guide your preparations. 

A professional can work with you every step of the way in your estate planning and make the process less daunting. The knowledge and expertise of a financial advisor can help you navigate the complexities of estate planning, and ensure you have a financial plan in place that takes into account the present and future needs of you and your spouse.

At Five Pine Wealth Management, we have the experience to guide you through the process of estate planning and protecting the legacy you built with your spouse. As fee-only fiduciary financial advisors, we work only in your best interest to help you make the right financial decisions for yourself and your family. 

To see if we can help, call us at 877-333-1015, email us, or fill out our contact form to schedule a time to chat.