Unless you are like those older couples, where one dies shortly after the other, chances are you will be spending a certain amount of time in your later years, as a widow or widower. Will you be ready?
There are now some 20 million widows and widowers, according to a study by Merrill Lynch and Age Wave, and every year, 1.4 million people join their ranks. Preparing to be on your own, is up there with talking about funeral plans and finalizing your estate plan. But it’s a life event that needs to be discussed.
Did you know that women are more than three times as likely as men to lose their spouse, according to the Merrill Lynch and Age Wave study? That’s because women typically outlive men, and men tend to marry younger women. Women, in particular, need to be ready for this stage of their lives.
CBS Money Watch’s recent article, “A retirement planning must-do for married couples,” says that there's still a big disconnect between both members of a married couple concerning this risk. About 53% of those who've lost a spouse, said they didn't have a plan if one of them passed away. More than 76% of married retirees also responded that they wouldn't be financially prepared for retirement, if their spouse passed away.
More than 75% of people who've lost a spouse said it's the single hardest thing they've ever been through. Half of these individuals experience a household decline in income of 50% or more, with 66% reporting that adjusting to this income loss is their top financial concern.
About two-thirds of those who've lost a spouse said at the start of their grief, they were so overwhelmed with paperwork, they didn't know where to start.
The Merrill Lynch/Age Wave study found that only 36% of people who lost a spouse (but planned for it) were concerned that they wouldn't be able to support themselves right afterward, compared to 64% in this group who hadn't planned at all. Therefore, what advice do people who've lost their spouse have for the newly widowed? Consider this:
- Don’t make major decisions immediately.
- Find your important documents and continue to pay bills on time.
- Inform employers and financial institutions.
- Review your retirement strategy.
- Update your beneficiaries and estate plans.
- Know how to access your spouse's accounts and place both names on all accounts and deeds.
- Be able to easily access cash.
- Keep your credit card debt separate.
The results from the study show that this is a very tough transition, but 75% of people reported finding courage they never knew they had and roughly the same number saying they consider themselves more financially knowledgeable than most people their age, after undergoing the death of a spouse.
Reference: CBS Money Watch (September 12, 2018) “A retirement planning must-do for married couples”