Retirement Survivor Guide: 3 Retirement Action Steps to Take NOW To Protect Your Spouse Financially

Losing your Spouse:

Jessica Cannella: Losing a spouse is one of the most stressful events that each one of us will experience in our lifetime. It’s something that is often too painful to even think about, let alone speak openly about. We all know someone that has lost somebody close to them, their husband or their wife, and sometimes it’s after a long, painful, bittersweet goodbye. More often than not, it happens very suddenly. When death happens unexpectedly, it causes a visceral response, a pain felt to the very core of our being. You’ll never be ready to lose a spouse emotionally.

That’s a process that only time can help. Little by little, one day at a time often, as the pain of loss begins to lose its edge, we start to heal. Financially speaking, allowing too much time to pass has the reverse effect. With just a little intention, you can be prepared financially to withstand the loss of your spouse. I think that Dr. John Maxwell says it best. He says you can choose how to approach life. You can be proactive and spend your time preparing, or you can be reactive with a focus on repairing. When your spouse passes, I want you to be able to focus on repairing your heart, not your finances.


The Different Steps:

Jessica: I’m Jessica Cannella. Co-Founder and President of Oak Harvest Financial Group. If you’re joining me in this series, I wanted to take you through three action steps that you can take right now, while your spouse is still living, to protect each other from financial stress. The reality is that you or your spouse will pass away, and I want for you to be prepared. The time is now to have a conversation with your spouse. I’m going to try to break this down into three easy steps. First, we’ll talk about taking inventory. Next, we’re going to talk about taking the initiative, and last, we’ll talk about being intentional.

Action Step 1, take inventory. All right. The first action step, guys, is to take inventory. I want you to have some fun with it. Make it a date night. Order a pizza, pour a glass of wine, and focus on connecting with your spouse. Grab your pen, a piece of paper, or your Excel spreadsheet if that’s your jam. Make a list of everything financial that you have. Brainstorm with your spouse. Think of things like your joint and your individual assets, your bank accounts, your investment accounts, bills, debts, insurance policies, expenses, and income sources.

Happy married couple holding hands on the front porch

Literally, everything financially that you have in place, I want you to bring it up and put it onto paper or in your Excel spreadsheet on this date. Transparency is key here. Don’t hold anything back. This is a judgment-free zone. If you’re ahead of the game and you feel like, “You know, I’ve got a really good grasp on what’s going on financially in my own household,” please don’t assume the same of your spouse. It’s extremely common for one spouse to gravitate towards the financial endeavors of the household, and the other one is just like, “Yes, he or she has got this.”

This drill is really meant to be a collaborative, dual effort for both of you. This is your opportunity to check in with your partner and compare notes. Maybe you never mentioned that you’re paying $225 debited right out of your account for that Pilates package you signed up for six months ago, or maybe your spouse forgot to tell you about that Home Depot credit card he opened. He’s been working on a project and the perks offered with the card sounded pretty good. He went ahead and signed up for it, unbeknown to you. This inventory is meant for you to get it all out on the table.

Taking inventory and sharing it with your spouse shouldn’t be a one-and-done situation. Consider having this as a regular date night, maybe once a quarter, twice a year, and at a very minimum, an annual date night. For my complete financial checklist, be sure to click the description box for a link. Action Step 2, it’s time to take initiative. Take the bull by the horns. Now that you’ve come clean about your Pilates membership and the newest power tool on the charge card, the next step is to take initiative on a few practical matters. For instance, did you know that there’s a difference between being a joint account owner versus being an authorized user on an account?

Consider that Home Depot card for a second, the one you just found out about. As an authorized user, you can do things like, make purchases with the card, or call and find out what the balance is, but only as a joint account owner can you close the account when your spouse passes away. Beyond credit cards, this applies to cell phone providers, home loans, banks, and brokerage accounts. I want you to take initiative and verify that you and your spouse have joint ownership on the accounts that are most important to you and your family. When it comes to your liquid assets, which means money in the bank or your brokerage accounts, adding the letters TOD, which stands for transfer on death, for all of those accounts, brokerage, stocks, bonds, and other investments, is very important.

It allows for the assets to transfer directly to your spouse with no interruptions, no proof of death certificate, or anything. It’s automatic. Also, if you and your spouse pass away simultaneously, you’ll want to be prepared before that, of course, to add the letters POD, which stands for payable on death. Now, this allows for your beneficiaries to receive the assets from your checking account, savings accounts automatically at your death. It allows for you to skip the lengthy probate process, or excuse me, you’re deceased, for your beneficiaries to skip that process.

Couple in love

The money just shows up according to your wishes in their accounts. Again, that’s TOD for transfer on death, spouse to spouse, or POD for payable on death, you and your spouse to your beneficiary. Another pro tip that I have for you today is to consider sharing passcodes to your cell phones. You’re going to want to take it a step further even. Now, you can actually add your face ID. If you hold your spouse’s phone up to your face and you’re already logged in there, it will open up the phone automatically. In the invent of an emergency, recalling a password in a panic state is often a bad recipe, one for disaster.

Avoid it. Add your face ID. If you’re anything like me, you probably keep your most sentimental pictures and memories in your phone. Also, I’ll be the first one to admit it here, I keep every password in my phone. Another pro tip, I keep my passwords under a list called groceries that begins, bananas, grapes, waffles. Then down below, all of my important passwords. I do this just as a little added measure of security in case I lose my phone or it’s compromised. I’m willing to bet that most thieves don’t check the grocery list. Action Step 3, be intentional.

When you are truly intentional, you choose to make decisions and take action on what is just most important to you. Being intentional means getting clear and upfront about what you want to achieve for a future outcome. That financial inventory that you compiled in Step 1, be intentional about updating it at least annually. Maintaining a binder or a filing cabinet that contains all of your important documents. Your annual inventory list, your important financial documents, legal documents, any wills, for example, or other legal items like your car title, you’re deed to your house.

Additional Measures:

Also, pro tip, consider adding a VIP contact list to the binder or filing cabinet. A contact list that outlines things like your spouse’s employer’s benefits and your own, so that they know who to call in the HR department or their plan administrator. Contact information, like any professional that you work with, be it your financial advisor, your attorney, a CPA, estate planners. You should absolutely consider including some documents like your passport, marriage certificate, birth certificate, and, of course, any life insurance policies or insurance policies in general.

Bottom view plan written on black notepad lupa keyboard binder clip pen on black background

Lastly, I want you to be intentional about where you keep this sensitive information. Consider sharing your hidden repository with one other trusted adult. Maybe an adult child or a trusted friend. Also, another pro tip, consider having a digital password-protected version of these documents. As much as I personally would like to believe that we all will die next to our beloved, just like the couple in The Notebook passed away holding hands in the nursing home bed on the same day, I think it’s very unlikely. As hard as this topic might be, and even if it’s giving you a little bit of apprehension, you should continue to connect with your spouse and have the difficult conversations.

Let it be a date night. Make it fun so you can focus on what is most important during the time of loss and give that gift to your spouse if it’s you that passes first. I know that preparing financially for the death of your spouse while they’re here now is truly an act of love. I’ll share with you, in our next video in the series, the first five things that you’ll need to do immediately when your spouse passes. Thanks for watching, and I look forward to seeing you back soon.