Widows and Money

Becoming a widow is a life-altering experience in many ways, not the least of which is dealing with money issues. Unfortunately, many widows say they are unsure, scared, or tentative when dealing with their finances. This even includes women who have comfortable incomes and portfolios.

According to a recent study by Merrill Lynch, 80% of recently widowed women say they have had little experience in handling finances other than a household budget, and 50% say they are not comfortable making investments. Many women say they have a hard time making financial decisions because they are afraid of making a mistake.

If you have been widowed recently, what things should you do to prepare yourself for handling money and dealing with financial issues? Here are some suggestions:

• Don’t make quick decisions. Other than necessary items, it’s a good strategy to delay any major financial decisions after you lose your spouse. Decisions made under stress or in a hurry are frequently bad. Waiting will help you plan and consider your options.
• Make sure you know where the money is. Check to make sure you have all bank statements, brokerage statements, insurance information, pension statements, or any other investments. A good place to double check is your federal tax return. The supporting schedules list all sources of income.
• Determine your goals. In order to make wise financial decisions you need you have clear goals. How much monthly income do you need? Do you want to travel? Do you want to make monetary gifts to your family? Understanding your goals is the roadmap for a good financial plan.
• Choose an advisor carefully. This is very important as you must be comfortable with and trust your advisor. Your advisor should be knowledgeable, accessible, and clearly understand your goals. Shop around, ask family and friends, interview several advisors and don’t hesitate to tell someone they aren’t right for you. Be wary of anyone who wants you to make quick decisions, guarantees returns, or wants you to invest in only one thing. You can check to see if your broker has any complaints filed against them.