Comments on: How to Increase Your Widow or Widower Benefits http://wealthpilgrim.com/how-to-increase-your-widow-or-widowers-benefits/ WealthPilgrim.com -No Money Worries. No Matter What. Tue, 22 May 2012 13:10:32 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: Erik http://wealthpilgrim.com/how-to-increase-your-widow-or-widowers-benefits/#comment-3282 Erik Thu, 07 Jan 2010 17:23:37 +0000 http://wealthpilgrim.com/?p=12852#comment-3282 Good points, Neal. Part of taking care of one’s spouse is ensuring that if one party dies or is incapacitated, the other spouse can manage to keep the ship floating and navigate the rough waters. Complicating this issue is when one spouse (my wife, for example) does not like to talk about finances, the possibility of early demise and generally isn’t as good with numbers and cents. I’ve had to think of creative ways to broach the subject and train my wife in case the worst should happen to me. I think the following three topics are essential: 1) Have an updated will. Sure for the most part your estate will transfer to your spouse seamlessly, but if there are any kinks or quirks from past marriages, children, etc. it would be best to have this all spelled out. Review this document annually or anytime your family situation changes (birth/death of child, etc.). 2) Carry adequate life insurance on both spouses, even “non-working”. Experts I’ve read online suggest 8 – 10 times the annual income of the covered member. Term life insurance is cheap if you have no pre-existing health conditions. My wife was stay-at-home with our twins the last three years, but we still bought a policy on her to cover daycare expenses if she were incapacitated or died suddenly. 3) Have a written budget where both spouses have input and know what is going on. So many couples try to divvy out the jobs (I pay the mortgage, she pays the cars and utilities, etc.) or worse just one spouse handles all the finances. This is a disaster waiting to happen when one party unexpectedly falls out of the equation. Both spouses need access to and understanding of the basic financial processes that make the day-to-day possible. For example, if one spouse handles the mortgage, will the other spouse know about things like who carries your homeowner’s insurance, whether or not your bank escrows yearly taxes, etc? Also, which bills are set to autopay? Do you get notice that automatic drafts are on your spouse’s account? Will you know when to debit your checkbook ledger for the house payment? Which checks have to be cut by which date to avoid late fees? You MUST combine your finances or risk having one party miss a lot of important steps you take to handle basic income/expense management. If you must have separate accounts, keep them limited to “mad money” only that doesn’t affect your bills. These three are basics, and there are a lot more specific areas to address, such as rebalancing cash flow, canceling monthly services, reworking numbers based on one adult instead of two, downsizing living accommodations if necessary, keeping medical coverage in place if the deceased spouse’s job was the provider, etc. Having seen what happened to my in-laws when my wife’s father was diagnosed with early onset Alzheimer’s I know what pain and frustration it causes when one party (my mother-in-law) is not familiar with the basics. It took her awhile but she’s finally gotten most things under control. Good points, Neal. Part of taking care of one’s spouse is ensuring that if one party dies or is incapacitated, the other spouse can manage to keep the ship floating and navigate the rough waters. Complicating this issue is when one spouse (my wife, for example) does not like to talk about finances, the possibility of early demise and generally isn’t as good with numbers and cents. I’ve had to think of creative ways to broach the subject and train my wife in case the worst should happen to me.
I think the following three topics are essential:
1) Have an updated will. Sure for the most part your estate will transfer to your spouse seamlessly, but if there are any kinks or quirks from past marriages, children, etc. it would be best to have this all spelled out. Review this document annually or anytime your family situation changes (birth/death of child, etc.).
2) Carry adequate life insurance on both spouses, even “non-working”. Experts I’ve read online suggest 8 – 10 times the annual income of the covered member. Term life insurance is cheap if you have no pre-existing health conditions. My wife was stay-at-home with our twins the last three years, but we still bought a policy on her to cover daycare expenses if she were incapacitated or died suddenly.
3) Have a written budget where both spouses have input and know what is going on. So many couples try to divvy out the jobs (I pay the mortgage, she pays the cars and utilities, etc.) or worse just one spouse handles all the finances. This is a disaster waiting to happen when one party unexpectedly falls out of the equation. Both spouses need access to and understanding of the basic financial processes that make the day-to-day possible. For example, if one spouse handles the mortgage, will the other spouse know about things like who carries your homeowner’s insurance, whether or not your bank escrows yearly taxes, etc? Also, which bills are set to autopay? Do you get notice that automatic drafts are on your spouse’s account? Will you know when to debit your checkbook ledger for the house payment? Which checks have to be cut by which date to avoid late fees? You MUST combine your finances or risk having one party miss a lot of important steps you take to handle basic income/expense management. If you must have separate accounts, keep them limited to “mad money” only that doesn’t affect your bills.

These three are basics, and there are a lot more specific areas to address, such as rebalancing cash flow, canceling monthly services, reworking numbers based on one adult instead of two, downsizing living accommodations if necessary, keeping medical coverage in place if the deceased spouse’s job was the provider, etc. Having seen what happened to my in-laws when my wife’s father was diagnosed with early onset Alzheimer’s I know what pain and frustration it causes when one party (my mother-in-law) is not familiar with the basics. It took her awhile but she’s finally gotten most things under control.

]]> By: Neal http://wealthpilgrim.com/how-to-increase-your-widow-or-widowers-benefits/#comment-3277 Neal Thu, 07 Jan 2010 00:33:59 +0000 http://wealthpilgrim.com/?p=12852#comment-3277 Right...I am a big fan of having your own term life insurance. I don't like having such an important part of the financial picture tied to a company that I have no control over. .-= Neal´s last blog ..<a href="http://wealthpilgrim.com/how-to-increase-your-widow-or-widowers-benefits/" rel="nofollow">How To Increase Your Widow or Widower’s Benefits</a> =-. Right…I am a big fan of having your own term life insurance. I don’t like having such an important part of the financial picture tied to a company that I have no control over.
.-= Neal´s last blog ..How To Increase Your Widow or Widower’s Benefits =-.

]]> By: Sandy L http://wealthpilgrim.com/how-to-increase-your-widow-or-widowers-benefits/#comment-3276 Sandy L Wed, 06 Jan 2010 20:48:42 +0000 http://wealthpilgrim.com/?p=12852#comment-3276 About all we did in planning was maxing out our work life insurance and making sure we have a plan for guardianship of kids. I realize this plan stinks if we change jobs or get laid off. We'd like to have a life insurance plan not tied to working at a particular company. Susana, You still need the basics..a will, some money for your funeral, your wishes documented somewhere. Who will be your advocate if you get health problems and aren't able to speak up for yourself? If you have pets, you need to plan for them too. If you don't have immediate family or close friends you can appoint a lawyer to speak on your behalf and be the executor of your estate. About all we did in planning was maxing out our work life insurance and making sure we have a plan for guardianship of kids. I realize this plan stinks if we change jobs or get laid off. We’d like to have a life insurance plan not tied to working at a particular company.

Susana,

You still need the basics..a will, some money for your funeral, your wishes documented somewhere. Who will be your advocate if you get health problems and aren’t able to speak up for yourself? If you have pets, you need to plan for them too. If you don’t have immediate family or close friends you can appoint a lawyer to speak on your behalf and be the executor of your estate.

]]> By: Neal@WealthPilgrim http://wealthpilgrim.com/how-to-increase-your-widow-or-widowers-benefits/#comment-3275 Neal@WealthPilgrim Wed, 06 Jan 2010 20:11:30 +0000 http://wealthpilgrim.com/?p=12852#comment-3275 Joel,,,,,believe me,,,,I'm not trying to be morbid but terrible things happen. Get it done and then you can forget about it and go on to more fun activities. If you do, I'll see if I can wrangle you up the Pilgrim Pick of the Pack Award! .-= Neal@WealthPilgrim´s last blog ..<a href="http://wealthpilgrim.com/how-to-increase-your-widow-or-widowers-benefits/" rel="nofollow">How To Increase Your Widow or Widower’s Benefits</a> =-. Joel,,,,,believe me,,,,I’m not trying to be morbid but terrible things happen. Get it done and then you can forget about it and go on to more fun activities. If you do, I’ll see if I can wrangle you up the Pilgrim Pick of the Pack Award!
.-= Neal@WealthPilgrim´s last blog ..How To Increase Your Widow or Widower’s Benefits =-.

]]> By: Neal@WealthPilgrim http://wealthpilgrim.com/how-to-increase-your-widow-or-widowers-benefits/#comment-3274 Neal@WealthPilgrim Wed, 06 Jan 2010 20:10:12 +0000 http://wealthpilgrim.com/?p=12852#comment-3274 Great issue......you got it!!!!!!! Thanks for kicking my Pilgrim Bottom on this oversight :) I deserved it Susan. .-= Neal@WealthPilgrim´s last blog ..<a href="http://wealthpilgrim.com/how-to-increase-your-widow-or-widowers-benefits/" rel="nofollow">How To Increase Your Widow or Widower’s Benefits</a> =-. Great issue……you got it!!!!!!! Thanks for kicking my Pilgrim Bottom on this oversight :) I deserved it Susan.
.-= Neal@WealthPilgrim´s last blog ..How To Increase Your Widow or Widower’s Benefits =-.

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