Helping widows navigate a new reality

The heartbreak of becoming a widow is often amplified by the uncertainty over facing the days and years ahead without a partner by one’s side. Shared goals, ambitions and dreams may no longer seem relevant, and the burden of making decisions about the future rests solely on the surviving spouse who likely isn’t ready for a new reality.

Women are twice as likely as men to become a widow and may face many years alone. Surviving spouses aged 60 and older are also less likely to be in the labor force than their peers.1 In the wake of becoming a widow, they may need assistance, especially if their spouse handled paying bills and managed their finances. 

It’s important to help guide a widowed client through the many financial decisions that need to be made, yet it can be difficult to find the words to say or know when to reach out. When you sense the time is right, consider the following when speaking with a grieving spouse.

Understand the phases of grief

Grief is understandably the first phase of widowhood and may span months or years. Early on, the emotions can be raw and range from deep anguish to feeling numb. Combined with emotions, high levels of stress and uncertainty may cloud a person’s judgment. 

During this most vulnerable time, it’s important for a surviving spouse to not make any major decisions. Rather than talking about investing strategies and what to do with any life insurance proceeds, it might be best to talk about immediate needs like cash flow, paying bills or settling the estate. 

Providing a broad overview of assets may help put your client’s mind at ease, and knowing there’s time to address long-term needs later on could be a relief. Depending on how strong your relationship is with the surviving spouse, you may even offer to accompany her when she meets with the estate attorney, especially if no one else is available.

Address their biggest fears

A newly widowed person experiences an incredible range of emotions, from loss and intense grief to loneliness, anger and fear. One of the biggest fears may be wondering how they’ll make ends meet and avoid running out of money.

Over time, your client’s clouded thinking will likely clear and provide an opportunity for you to focus on planning for the years ahead. When that time comes, take a deeper dive into their income sources and expenses now that it’s a single-person household.

Was there a life insurance payout? Explore ways to protect those assets by placing them in lower-risk accounts, such as a money market fund or a reputable annuity that can provide guaranteed monthly income. If a widow is younger and still has working years ahead, perhaps more traditional investments are in order.

Even though the process of settling a spouse’s estate can be challenging, it’s a good idea to think of her own estate planning needs, too.

Help widows avoid financial pitfalls

In the coming years your widowed client may decide to marry again. While your role certainly isn’t to serve as a premarital counselor, it is important to make sure your client understands the financial implications of remarriage and how to avoid potential risks.

For example, if your client is younger than age 60 and remarries, they will not be able to claim their deceased spouse’s Social Security benefits while married to someone else. If they wait to remarry until after age 60, they can still receive those benefits.2 While it may not be enough to discourage marrying again or postponing the decision, it’s best not to be met with a surprise afterward.

For older generations, talking about money may not feel comfortable. However, it’s important for you to encourage your widowed client to thoroughly discuss financial arrangements before committing to a long-term relationship

Some questions that need answers might include:

  • What income sources does each partner have and how much will each bring in?
  • Who will pay for living expenses and what portion?
  • Will some assets be combined in a checking account to pay shared bills?
  • How much money will each keep in separate accounts?
  • Will new estate plans and wills be drawn up for each?

The adage that “love is blind” may hold some truth when it comes to getting remarried. That’s why it’s important to address the financial side of things ahead of time with tact and care. There are sadly too many stories of widows entering into new relationships, only to have their savings wiped out or to learn their new spouses can’t support themselves. 

Encourage widowed clients to meet with you to develop a financial plan together before making any major decisions. Your client may appreciate having a third party to help navigate the conversation and be willing to ask the tough questions on their behalf. Having a financial agreement and transparency between the two can help their relationship—and, potentially, the relationships they have with their children and beneficiaries who may have concerns.

Show you care

Ideally, as a financial professional, you’ve already established a strong relationship with both spouses, so you may have your own emotions to deal with when one of them dies. Acknowledging those feelings and sharing memories and caring thoughts may be healing for both of you.

Another way to help clients in crisis is to understand the tie between their emotions and behaviors. We’ve developed numerous resources that can help you navigate difficult client situations using behavioral finance principles. Access our award-winning Behavioral finance advice program resources today, and contact the TruStage Annuity Solutions Desk at 877.345.GROW (4769), option 1 with any questions or to request additional resources.

Marshall Heitzman
Written by: Marshall Heitzman, CFP®, ChFC, FLMI, CPCU, BFA™

Marshall is TruStage's Advanced Planning Expert and has more than 25 years of experience in the insurance and financial services industry. He consults Financial Professionals on advanced retirement planning concepts for retirement and wealth management clients.

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