Gain Peace of Mind and Empowerment with These Meaningful Financial Moves

Widowhood is one of the highest financial risk factors women can face, with an increased risk of falling into poverty after losing their late spouse’s income. Social Security benefits are also cut, anywhere from 33% to 50%, and further losses can be accrued if the late spouse’s work-sponsored pension is canceled or reduced after they pass. The poverty rate for widowed women 65+ in America is nearly 15% — almost 40% higher than the poverty rate for widowers, according to the Congressional Research Service. That’s why, even when you may feel overwhelmed by feelings of grief rather than focusing on your bottom line, it’s important to keep these widow financial planning strategies in mind as you look toward the future.

Be a Team Player

If you’ve lost your spouse, it’s easy to feel like you’re all alone on your financial journey. However, a smart, trusted financial advisor can help you navigate the challenges. Many widows haven’t managed finances solo before, and they may be unsure of how to handle investments and planning alone. Surround yourself with a team that knows your situation and has your best interests at heart.

Remember, too, there’s no rule that says you must stay with your late spouse’s financial advisor. It’s smart to take a moment to re-evaluate your relationship with your team. You may find that you don’t have the comfort level you desire, in which case it’s perfectly acceptable to find a financial advisor you feel more confident working with.

If you do decide to hire a new advisor, make sure you do some research before you settle on someone. Ask friends and family for recommendations, especially for a team that has experience working with people who have just lost their partners.

Tackle Your Fears

Losing your partner is an inherently frightening experience—there are a lot of unknowns to fight through and a lot of new things to navigate. When it comes to money, it’s natural for widows to feel unsure or even afraid about what they could be facing.

A common fear is running out of money, even if that’s not a reality-based concern. It can be very scary, particularly if your partner was the breadwinner. One of the best ways to address this head-on is to get all your information into one place so you can see a big-picture view of your financial situation.

• Make a detailed list of all your debts and assets.
• Add up all the income you receive from employment, Social Security, real estate, pensions or other sources.
• Tally up your average spending per month. If you closely track your spending, you should be able to get a good sense of your patterns and areas for improvement.
• Now that you have all your information in one place, look for any imbalances in income vs. spending. If there aren’t any, you should feel relieved and gain peace of mind. If there is, however, there are many widow financial planning strategies you can do to get your budget back on track.

Whatever your biggest financial fears are, a great way to tackle them is to write them down. If you get them out of your head and onto the page, you can start to work toward a solution, rather than focusing on the problem. Bring your list to your next meeting with your financial team so you can get the professional guidance you need to move forward confidently.

Innovate Your Investments

An investment portfolio when you’re married is often not going to look the same as when you’re on your own. Often, this comes down to comfort with risk tolerance and interest in playing the market. For many widows, especially in later seasons of life, it may make sense to readjust your investment strategy to better fit this new stage of life.

There are many factors to consider: changes in income, tax rates, and tax-filing status, for example. In addition to reducing risk, you may also want to consider if investments are a good way to put your money to work making up for the income your late spouse can no longer contribute. A financial professional can help you incorporate a balanced portfolio into your larger widow financial planning strategy.

Widow Financial Planning: What’s Next

There’s so much on your plate when you’re a widow—grief, life changes, overcoming your fears, and figuring out your financial landscape. The widow financial planning tips above can help you solidify a plan for your present that will also take you into the future.

Illuminated Advisors is the original creator of the content shared herein. I have been granted a license in perpetuity to publish this article on my website’s blog and share its contents on social media platforms. I have no right to distribute the articles, or any other content provided to me, or my Firm, by Illuminated Advisors in a printed or otherwise non-digital format. I am not permitted to use the content provided to me or my firm by Illuminated Advisors in videos, audio publications, or in books of any kind.