My husband died recently, and for the first time in many years I am looking after my finances directly.
I am not under immediate pressure and have day-to-day income. But our investment assets are now in my sole name, and longer-term, I want to have much better understanding of what is happening my money. Where do I begin?
– V McD, Tipperary
Most couples divide out the domestic jobs and that can leave quite a gap when you lose your spouse. The first steps are to understand what you’ve got, and how you’ll manage it from here.
A lot will depend on the kinds of financial assets you and your husband owned.
It could be very simple. For example, if your main household income was a ‘defined benefit’ pension, which provides a guaranteed income for life, then there will likely be a residual benefit for the surviving spouse – perhaps two-thirds or half of the original income – which itself will be guaranteed. But you probably wouldn’t be asking the question if things were that easy.
On the other hand, if your income is derived from, say, stock market investments, buy-to-let property, or approved retirement funds, then there are decisions to make about how you’ll maintain and manage them.
Don’t put off dealing with your finances after bereavement
It’s said that you should not rush into big decisions in the wake of a bereavement. But in our experience, it’s worth getting a grip of the financial facts without delay. Otherwise, the job becomes more complicated and stressful.
Identify your income
Take steps now to identify where your income is coming from, and make sure you’re receiving it. With luck there will be some documents to go on, or perhaps a trusted advisor who knows where the assets lie.
Don’t assume the big institutions will have your best interests at heart. We have seen cases where pension providers simply cut off payments on notification of death, without offering information on entitlement to a pension for the surviving spouse. Similarly the banks offer a patchy service when dealing with bereavement.
So be sure to collect payments that are due to you. That might include rental income, life assurance policies, or survivor’s pensions, for example.
Secure your assets
Next, secure your assets. You’ll likely have to seek a grant of probate to administer your husband’s estate. You don’t require a solicitor for this, but a competent and responsive one may be worth it if the estate is complicated. Bear in mind that this does not require to be the solicitor who held your husband’s will – and that you should review your own will at the same time.
What needs to change?
You will also need to decide how you’ll manage your assets into the future. Things might need to change. For example, you might not want to manage a rental property directly. For pension and investment money, your requirements for income, growth and risk should be recalibrated.
Financial advice could be well worthwhile
It’s a sensible time to take financial advice. Particularly if your husband took a very hands-on approach to managing the family finances, a financial professional can fill some of the knowledge gap.
Having secured your income and assets, review your wider financial situation. Your costs may change – or need to change – for the next phase of life.
More generally, consider the people you want around you to guide and help manage your finances after bereavement. It might include a trusted person like a daughter or son to consult on major decisions, as well as to help with financial administration such as insuring your health and your house.
This article is adapted from a Moneycube column which appeared in the Sunday Times on 2 June 2024.
