Becoming a widow is a difficult experience, both emotionally and socially as you adjust to life without your partner. However, it can also be very difficult financially, as you must adjust to a new financial reality. This is especially true for women who are widowed at younger ages, who are at a greater risk for economic hardship.
Widows may find that their income has been dramatically altered following the death of their partner, while their financial responsibilities, such as providing for a family, may be no less difficult. It may also be the case that a widow's finances are tied up in accounts that belonged to their partner, making them difficult to access in times of need.
Fortunately, there are options available for widows who are facing financial hardship. If you or someone you know is recently widowed or may become a widow, it’s important to understand the options available to you, such as tax relief services, as well as the challenges that lie ahead.
Being a Widow
Every widow has a different experience with losing their partner. Some, especially older individuals who are well into retirement, may be prepared for widowhood, having made sure that their finances are accessible and sufficient to carry them through retirement. For other widows, however, the death of a partner can strike suddenly and without warning, at a time when they aren’t financially prepared. This second group typically includes younger women, whose spouses die suddenly, whether in an accident, as a result of disease, or during military deployment.
Depending on the circumstances of their partner’s passing and their own financial reality, different widows may have different resources available to them. It’s important to understand that each situation is different and each person may have a different path towards financial recovery after losing their spouse.
How to Pay for A Funeral
Perhaps one of the most financially and emotionally difficult parts of becoming a widow is the funeral of a lost spouse. Nonetheless, this is an important ceremony for many people and a way of saying goodbye to a loved one. In order to ensure that a spouse’s funeral doesn’t lead to extreme debt, it’s important to understand the costs associated with a funeral so that you can prioritize which services are most important to you and avoid spending too much on things that you don’t need. Some expenses to be aware of include:
- Caskets: Caskets are a key part of any traditional funeral, but they come in many varieties. Simpler wooden caskets may cost about $2,000 on average. However, more durable caskets made of metals such as bronze or copper can cost up to $10,000. Caskets may also include features like rubber gaskets to prevent water from disturbing the corpse for an extended period of time.
- Embalming: Embalming is often required by funeral homes for anyone who wants to have an open-casket funeral or otherwise present the body. This process can stave off decomposition for a period of time, but it does cost extra. According to federal law, no funeral home can embalm a body without the next of kin’s consent.
- Grave Liners: A grave liner is a layer of material placed around a casket to prevent the ground from collapsing in on it. They can help to extend the period of time during which as casket is left undisturbed, but, like other measures we’ve discussed, they will not last forever. There are also no laws requiring grave liners and it’s illegal for a funeral home to tell you otherwise.
- Other Services: Any funeral is likely to involve additional expenses for miscellaneous services, such as the storage of a body in the funeral home and transportation fees associated with moving the body from place to place. Additionally, if you need to hire someone to speak at your spouse’s funeral, they may have fees associated with their appearance.
Even if you find the most affordable options, a funeral can still be quite an expense for the average person. Some insurance policies, such as life insurance, can help with funeral expenses, and so will veterans benefits, for military spouses who have been widowed. For those who haven’t pursued funeral coverage benefits in advance, personal loans, savings accounts, or credit cards can also help to mitigate the immediate financial impact of a funeral.
Financial Planning Tips For Widows
For many married partners, finances can be tied together in sophisticated and sometimes confusing ways. At times this can be a boon, such as a savings account or life insurance policy in your partner’s name, which may help you manage your finances after their passing. However, it can also become a problem, such as when the IRS assumes that you are responsible for your spouse’s taxes after their passing. Planning for financial security after a spouse’s death can be a matter of knowing the benefits available to you, but also preparing for the challenges that you may face.
LIFE INSURANCE PROCEEDS
If your spouse had a life insurance policy before their passing and you are listed as a beneficiary, you are entitled to the proceeds from that policy. It’s important for you to understand the terms of your spouse’s life insurance as well as you can, including who the beneficiaries are, when and how the benefits are to be paid out, and whose responsibility it is to contact that provider and submit an insurance claim upon your spouse’s death.
Planning for a loved one’s death can be a difficult conversation to have, but for many couples it’s an important one. A sudden death can be confusing, both emotionally and financially, as different parties dispute one another over who should take control of the deceased individual’s assets. Even for younger couples, a living will can be a good way to ensure some legal clarity and peace of mind following an unexpected passing.
Retirement accounts, such as an IRA or an employee pension plan, are intended to pay for a person’s expenses following retirement. Following that person’s death in retirement, however, the account may continue to pay out benefits to a designated beneficiary, such as that person’s spouse. Depending on the conditions stated in a person’s living will, retirement accounts that have not yet begun paying out may pass on to the owner’s spouse.
AVOID FINANCIAL PRESSURE FROM OTHERS
It’s not uncommon for widows to endure external financial pressures, whether they are the result of well-meaning confusion about the finances of the deceased or predators who want to take advantage of a difficult and emotional situation. It’s important to understand that you are not beholden to alter the conditions of your spouse’s estate to benefit anyone else, and that they are not entitled to any of your spouse’s assets not listed in their living will.
You may also find that there is confusion about what expenses you are responsible for following your spouse’s passing. The IRS may ask you to pay taxes on income or activities that you knew nothing about. Fortunately, you may qualify for innocent or injured spouse relief, which can shield you from your deceased spouse’s tax burdens. If you need help getting free of your spouse’s tax burdens, then a tax relief service may be able to assist you.
Debt Responsibilities of a Widow
If your spouse owes any debts upon their passing, their creditors may attempt to collect that debt from you. It’s important for you to understand that, in most cases, you are absolutely not responsible for debts incurred by your partner.. However, there are some exceptions.
WHAT ARE YOU RESPONSIBLE FOR?
You are responsible for any debt incurred by your spouse where:
- You jointly own an account, such as a credit card account. Note that this is different from being an authorized user on your spouse’s credit card.
- You are a co-signer on a loan or other debt incurred by your partner, which was left unpaid upon their passing. As a rule, co-signers are always responsible for a person’s debt when that person is unable to pay it for any reason.
- There is a law in your state that requires you to pay a particular kind of debt upon the passing of your spouse.
- You live in a community property state, which includes Alaska (if an agreement was signed), Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin.
COMMUNITY PROPERTY STATES
In the states noted above, property acquired by a married couple during their marriage is considered joint or community property.. This is true for anything they acquire except inheritance or a gift. In these states, a widow may be required to pay her spouse’s debts using the couple’s community property.
WHAT ARE YOU NOT RESPONSIBLE FOR?
Unless you fall into one of the cases identified above or you live in a state where local laws require you to pay back certain debts incurred by your spouse, you are not at all responsible for their debt, no matter what debt collectors say.
If you find yourself having trouble discerning which debts you are and are not responsible for or paying back debts incurred by your partner, then a debt relief service may be able to help.
Government Programs for Elderly Widows
The government is aware that widowdom can present many financial hardships, pressing some widows into poverty as they age. Fortunately, some social welfare programs provide benefits to people whose spouses have died.
Most people over the age of 65 are eligible for Medicare, the government’s health insurance for those who need help paying medical expenses after retirement. There are different parts and plans to Medicare, each with its own coverage limitations. Medicare always covers prescription drugs, but other services may depend on what you qualify for. You should speak to a Medicare official or your medical provider to find out exactly what is covered.
SOCIAL SECURITY BENEFITS
Social security is a government assistance program that pays out to individuals once they reach the full retirement age, which varies depending on the year that you were born in. Typically, people receive more money in social security if they put more money into the system when they were working. For widows who relied mostly on their partner’s income to make their families, there may not be much in the way of social security benefits that’s available.
Fortunately, it is possible to claim 50% of your partner’s social security benefit following their death, instead of collecting your own. This is called a spousal benefit. However, social security is generally not enough to sustain a person through retirement, so, while collecting on your spouse’s social security benefits can help, it may not be enough to alleviate all of your financial worries as a widow on its own.
Benefits and Programs for Military Widows
Spouses of soldiers who are deployed on active duty may be especially at risk of becoming widows, given the dangers of foreign deployment. Fortunately, the military is willing and able to look out for widows of veterans and they have several assistance programs available.
OFFICE OF SURVIVORS ASSISTANCE
The Office of Survivors Assistance at the Department of Veterans Affairs provides a slew of resources to spouses of veterans, including burial benefits to help with funeral expenses, its own health insurance program, and access to a fiduciary who can help you get your finances in order following the death of a spouse.
TRAGEDY ASSISTANCE PROGRAM FOR SURVIVORS
The Tragedy Assistance Program for Survivors (or TAPS) provides resources and emotional support for family members of deceased veterans. In particular, they provide access to educational programs, counseling, and retreats that may be especially helpful for military widows who are having trouble taking care of children following the death of a spouse.
How Widows Can Manage Their Money to Build a Financial Future
Immediate financial assistance or relief in the form of government welfare, assistance for spouses of veterans, or debt relief can help to shield you from being financially blindsided following the death of a spouse. However, many widows will need to plan for a new financial reality following the death of a spouse. Once you are ready, take the time to take stock of your finances, including your new expected income without your spouse. Doing this hard financial work now could help save you from a financial emergency later.
Scams Targeting the Elderly and Widowed
Senior widows in particular may be at risk of falling victim to scams. Con artists see this group as especially vulnerable, since many may have access to sizable retirement accounts along with excellent credit scores. Scammers may try to steal a victim’s money or identity using some of the following tactics:
- Tech Support Scams: You may be browsing the internet when a popup appears on your computer. The popup will tell you that you have hackers or viruses on your computer and that you must have all the numbers listed to receive computer assistance. This is always a scam; no reputable computer company will ever contact you in this way.
- Refund Scams: These scams often go hand-in-hand with tech support scams and may target people who have fallen victim to a scam in the past. In a refund scam, the scammer will call you claiming to represent a well-known company such as Microsoft or Google. They will claim to offer a refund for computer products or services you have purchased in the past. However, over the course of the scam, they will require access to your bank account, which they may manipulate to steal your information and money. No reputable company will ever need access to your bank account to give you a refund.
- Phishing Scammers: Scammers may contact you over the phone or through email, claiming to represent a reputable company or individual. They may even know some information about you, such as your name or address. They will try to get you to click on a link in an email or give out sensitive information on the phone, but in reality they are only trying to steal your information in order to impersonate you.
If you ever receive a suspicious call, offer to look up the company’s support phone number online, ask for a support ticket number, and call them back at the reputable number. Any real representative of that company will be happy to have you call back, but scammers will always try to keep you on the phone, knowing that you will be calling the real company back and not them. Thinking carefully before giving out any personal information or money can help to protect you from identity theft..
What are some resources and programs for grieving widows?
As you try to adjust to life as a widow, it’s important to remember that you aren’t alone. There are organizations out there full of people who can share their experiences and knowledge with you. Many help widows financially, helping you to get through this difficult time in your life.
- Hope For Widows Foundation: The Hope For Widows Foundation offers programs, resources, and a community for widows who are struggling following the loss of a spouse.
- Soaring Spirits International: Soaring Spirits International is a non-denominational non-profit organization whose mission is to help bring widows together and form a community. They specialize in outreach and connecting widows together as pen pals, so they can share their experiences and help one another out.
- WidowNet.org: WidowNet is a website specifically for widows to share their experiences. It offers community, stories, and news that may be relevant to widows.
Additional Financial Help and Financial Tips for Widows
One of the unfortunate realities of being a widow is that it forces you to balance grieving with the reality of tackling difficult things, like dealing with your spouse’s estate and adjusting to your new living situation. There are many other services that can assist you and make this process easier.
Financial professionals can be valuable resources for anyone but especially for widows looking to navigate their new financial situation.
Dealing with taxes, especially after the death of a spouse, can be highly complex. No matter how financially savvy you are, a tax professional like a CPA can help. You may not know which of your benefits are taxable and which aren’t. A CPA can also help you minimize the taxes both you and your spouse’s estate pay, leaving more money in your pocket.
A financial planner can also be a significant help, especially if your spouse was responsible for managing your household finances.
A good financial planner can help you figure out the best way to use things like life insurance proceeds and other widow benefits. They can also design a plan for how you’ll make sure you stay on a good financial path and are prepared for the future.
When your spouse dies, they may leave behind debt along with any assets they had. It may also be difficult to adjust to living as a widow, especially if you were a two-income household previously.
There are many credit counseling groups out there that can help you figure out how to manage your debt and develop good spending habits.
It’s important to find a good, non-profit credit counselor. There are many for-profit businesses in the credit counseling industry, some of which are less than savory and prey upon desperate people. A good resource is your local consumer protection agency or attorney general website to make sure the company you’re working with is reputable.
When your spouse dies, some of their assets will enter into probate. This is a legal process where their will is executed and the things they left behind are distributed.
Even if your spouse’s will is uncomplicated, hiring an attorney to manage the probate process is a good idea. They can prevent any unexpected issues from causing problems and help take that mental load off of you while you grieve.
An attorney can also help you update your own legal documents. You’ll likely want to adjust your will and give new people healthcare or financial powers of attorney to reflect your new living situation. A good attorney can identify the steps that you should take and help you follow through.
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