Wealth Management Group Newsletter – Fall 2016
Adam J. Pechin

What Needs to be Done with Your Finances After Your Spouse Dies

When a husband or wife passes away, it is a difficult time filled with uncertainty. The surviving spouse often feels overwhelmed and wonders what to do to get affairs in order. In most cases, the first thing that needs to be addressed are financial matters. The following outlines what a surviving spouse needs to do as soon as possible in regard to finances after a spouse dies.

Collect Financial Records

Start to gather all financial records and put them in one place. The items you need to collect include your spouse’s Social Security number, their will and any trust documents. You will need to obtain certified copies of your spouse’s death certificate from the funeral director or local government office. You are going to need to give this document to various organizations, so be sure to request multiple copies.

Did your spouse have any retirement accounts? If yes, then you need to access beneficiary designations forms for retirement accounts. In addition, you will need to gather all real estate deeds, military records and statements for investment, bank, credit card and other accounts. This is often a challenge since very few statements are being mailed, but rather are available online.

Once you find your spouse’s will, you need to determine who they have named as their executor.  Is it you or another individual? If your spouse had a trust, you will need to determine who is named as the successor trustee.

If your spouse had no will or trust, you will have to petition the courts to be named as personal representative or executor. At this point, you will need to hire an estate attorney to assist in the probate process or administration of any trusts and a tax professional to help you prepare tax returns.

Did Your Spouse Have Life Insurance?

If you are unsure about whether your spouse owned any life insurance policies, check bank statements for evidence of premium payments. Note, however, that premium payments may not have been required in recent years for some policies. It is important to check because, in many cases, the surviving spouse believes their husband or wife did not believe in getting life insurance, only to discover a policy in a drawer or safe deposit box after they die.

To claim life insurance benefits, you will need to provide a certified copy of the death certificate. Benefits typically pass to beneficiaries income-tax-free. You may want to consult with your tax advisor to determine whether, from an estate planning perspective, you should consider disclaiming any benefits so that they will pass to the policy’s secondary beneficiary.

Update Joint Accounts

It is also important to update your joint account registrations for assets held at banks and brokerage firms, as well as for titles to other property, by providing a certified copy of the death certificate. This is why you are going to need multiple copies of the death certificate. Accounts registered in your spouse’s name only may require additional paperwork to prove that you are the rightful heir or are acting as the personal representative or executor of your spouse’s estate. This will require a court-certified copy of your spouse’s will. For assets that were held in a trust, only the trustee can direct what happens to them, which is based on the terms of the trust.

For retirement accounts such as IRAs or 401(k) plans, the beneficiary designation form (not the will) determines who inherits the assets. IRS rules govern how these assets can pass from one person to another, and these rules are complicated, so be careful. Any decisions you make are irrevocable and could trigger taxes and penalties.

What About My Finances Moving Forward?

Be sure to update your documents after your loved one has died.  If you have any retirement accounts or life insurance policies, be sure to update your beneficiary forms.  It is also a good time to have your legal documents reviewed to make sure everything is in order for you.

This might be a good time to talk to your children or someone you trust to make sure they know where all your assets are located. This is what I call leaving them a roadmap of your assets. Though this is often a difficult conversation, you must remember that once you die, the person that you have designated to take care of your finances cannot ask you questions. Leaving this roadmap of your finances and what your final wishes are, as to who will inherit your assets, will give you peace of mind that everything will be taken care of after you have passed. It will also help to avoid confusion, disputes and hard feelings among family members.

How to Avoid Mistakes

Making major financial decisions while grieving the loss of your spouse can lead to costly mistakes and regrets. Ask a family member or friend to act as a sounding board and to help with the legwork. And, be sure to consult professional advisors. Do not be afraid to ask questions.   Remember, you and your spouse worked hard throughout your lives and want to ensure that you and your family are cared for.

For more information, contact Renee Andrews-Tushinski at 312.670.7444. Visit ORBA.com to learn more about our Wealth Management Services.

Contingency Planning: Don’t Let a Disaster Disrupt Your Life


As chief operating officer, Leah oversaw the creation of her company’s contingency (or disaster) plan. When a Category 4 hurricane put that plan to the test, it passed with flying colors. No employees were harmed and the company was able to resume operations only two days after the storm. Although the office sustained damage, insurance covered repair costs.

Unfortunately, Leah’s family wasn’t as prepared. She had trouble getting in touch with her husband and children as the storm approached, and though everyone was safe, their home was badly damaged. Worse, their homeowners’ insurance policy provided only limited flood coverage, forcing them to pay thousands of dollars out of pocket.

Leah learned a hard lesson: Individuals and families need disaster plans, too. Here is how to put one together.

First Things First

Start with your homeowners’ insurance. Make sure your policy covers flood, wind and other damage that is a real possibility in your region and that its dollar amount is adequate to cover replacement costs. Also, review and, if necessary, update your life and disability insurance.

Next, document all of your assets. Create a list of your bank accounts, titles, deeds, mortgages, home equity loans, investments and tax records. Then, inventory physical assets not only in writing (including brand names and model and serial numbers), but also by photographing them.

Ready Documents

It’s smart to store copies of important financial and personal documents somewhere other than your home. Secure, offsite locations include a safe deposit box at your bank or your attorney’s office.

You probably also have digital documents and data you want to protect. Consider “cloud computing” — storing files with a secure web-based storage provider so you can access them anywhere — or back up files on portable flash or hard drives you keep somewhere other than your home.

Cash on Hand

When a disaster strikes you may not receive insurance money right away. And while government relief funds may be made available (depending on the severity of the incident ) those funds typically are distributed weeks or months after the event. Having a cash reserve readily available is a key component of any recovery plan.

A good rule of thumb is to set aside three to six months’ worth of living expenses in a savings or money market account. You can draw from this cash reserve to pay for a hotel room and other day-to-day expenses in the interim.

Also consider keeping a cash reserve in your home in the event you are unable to access your bank accounts immediately. For an added level of protection, keep this cash in a durable, fireproof safe.

Communications and Supplies

Of course, if a disaster occurs, your physical security is paramount. Establish a family emergency plan that includes methods of getting in touch and a safe place to meet. Also devise evacuation routes should you need to leave your home, neighborhood or city quickly.

On the other hand, should a disaster require you to stay in your home for an extended period, you will need emergency supplies.

Finally, to stay informed of the latest developments, consider buying a battery-powered radio in case phone and data lines and wireless networks are down.

Do Not Procrastinate

You never know when disaster is going to strike. As many businesses have learned, it does not pay to put off contingency planning. And in many cases, families have a lot more to lose.

For more information, contact Adam Pechin at [email protected], or call him at 312.670.7444. Visit ORBA.com to learn more about our Wealth Management Services.

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