One of my biggest lessons learned in the work world, when I first started working in finance, was that just because you did everything right, the next person or department responsible for finishing the task may not be as diligent. I remember saying out loud, “What do you mean I have to confirm that the forms I submitted were processed and implemented accurately?”
Babysitting Paperwork
That is just one of several themes I keep seeing in helping women who have lost their spouse: submitting forms is only half the battle, confirming they were processed timely, completely, and accurately is the other half!
For example, one recent widow was told by her bank that she needed to resubmit the death certificate because they no longer had the one she brought in the first time.
Another woman mailed some account forms to an investment firm only to be told a month later that they were never received. I remember learning the hard way to be sure the date, phone number, name of who you spoke with, and conversation notes were all crucial to record for every phone call so that when you called back later to confirm that everything was completed, you had the history at your fingertips. Babysitting paperwork from beginning to end is crucial.
More Paperwork
Another common theme that is frustrating and surprising to women: even if you have your estate planning documents in place, there is often still a lot of paperwork that needs to be completed after a loss. Even if you have a trust, if you didn’t “fund the trust,” a.k.a., retitle your non-retirement assets (home, taxable investment accounts, land) into the name of the trust and/or use attorney-recommended beneficiary designations, you may still face probate too (paperwork, delay, cost).
Think of each account or property that you have as another set of paperwork. One woman who went through widowhood last year decided to consolidate a dozen bank accounts that they held at three different banks. She kept saying “I don’t want to do this to my son.” I very often hear from women who thought they had it all taken care of (meaning, they had a trust in place and thought that would be all that was needed), “I had no idea there would still be this much work to do!”
An Asset List
One of the most overlooked estate planning mistakes I see when helping women pick up the pieces and move forward is the lack of an asset list. There is usually no itemized master list of all investments, bank accounts, insurance, and property details. That list becomes the homework list as the pieces of the widow’s new life puzzle get figured out. You can’t move forward if you don’t first know where you are, financially.
One young widow found her husband’s password list, logged in online, and discovered accounts she had no idea existed. Another middle-aged woman went online to transfer things into her name without realizing the title of each account. She inadvertently transferred her deceased husband’s IRA into her bank account, with significant tax consequences. A detailed summary of what is where is the first starting point when starting over.
Stressful Time
I would argue that losing a spouse is likely the most stressful time in someone’s life. So, anything you can do in advance to avoid adding to that stress is a blessing to yourself. I worked with a woman who had been widowed three times, and I met her after the third one. We had a lot to take care of. After calls and letters to a firm to correct an error by their advisor (their computer system converted her Roth IRA to a Traditional IRA and no one caught it after 3 years, what!?!), amended tax returns, and consolidating accounts, she was able to retire and is living happily ever after.
Get Your Financial House in Order
After 20+ years of these types of stories, my one piece of seemingly simplistic advice, that will avoid all of the above themes, is to get your financial house in order. My solution to that was to design a single worksheet, My Networth Overview, that serves as your asset list, estate planning homework list, AND now (a newly added feature) a separate section that carries over your current asset list for AFTER you/spouse is gone to track notes, retitling, updates, distributions, etc. for the executor/successor trustee.
Whatever format you use to create an asset list, be sure you tell the pertinent person/people who will be involved about it and keep it updated annually. Things will go wrong in life so make sure you have done something right in advance to make that time easier.
Let’s Have a Conversation:
What experiences have you had or witnessed during widowhood? What was preventable? What lessons can we learn from what we have seen or experienced? Let’s have a discussion!