PUBLISHED THU, OCT 1 202010:11 AM EDT Michelle Fox@MFOXCNBC
Brenda
Pickens’ life changed dramatically this past spring, when her 63-year-old
husband, Howard, died from Covid-19 complications.
His
death, which occurred a month after the couple’s 28th wedding anniversary, was
something they never really planned for.
“We
didn’t think either one of us would be alone so early in our lives,” said
Pickens, 62, who also contracted the virus and spent months recovering.
With
only a small life insurance policy payout and some retirement savings, she
contemplated selling her home in Waveland, Mississippi, and her husband’s
barbershop, Fade 1, in nearby Bay St. Louis. Pickens was also furloughed from
her job at a naval base barbershop.
These
days, she’s seen some temporary financial relief, including a grant from the
state of Mississippi that will keep the barbershop running for about six
months. However, Pickens is now battling new health concerns. Since contracting
the coronavirus, she has developed heart issues and is seeing a number of
specialists.
Fortunately,
she has good insurance and is receiving paid time off from her job while on
medical leave.
“I’m
trying to hang in there, but if push comes to shove, I’ll file for disability,”
she said.
While
she has a support system, she is still grieving the loss of her husband.
“It
still gets kind of lonely,” Pickens said. “He was my best friend.”
However
financially prepared, or unprepared, you may be, losing a loved one is
overwhelming. Not only are you dealing with grief, but there are financial decisions
that must also be made. Here are seven steps you can take to help ease the
transition.
1. Take a pause
“It
might be tempting to make a lot of decisions all at once,” said certified
financial planner Stacy Francis, president and CEO of Francis
Financial in New York and a member of the CNBC
Financial Advisor Council.
That
may mean moving to a new place, selling a house, going right back to work and
taking a new job.
Her
advice: Don’t do it.
“Give
yourself a little bit of a pause so that you have time to allow yourself to
start the grief process and that you give yourself time to navigate this new
normal for yourself,” she said.
“When
you have been through trauma, it is very hard to think clearly.”
2. Seek help
Finding
professional support — through, for example, a grief counselor or therapist —
can help you navigate the mourning process. A financial expert, meanwhile, can
help you through money issues concerning insurance, wills, debt and the like.
“Put
yourself on a path of not only recovery, but to eventually be able to rebound,”
said Francis, who specializes in working with widows and widowers and is a
certified grief recovery specialist in The Grief Recovery Method approach.
Once
you are ready, you can review your finances and reset.
3. Understand your cash flow
The
first thing to do when it comes to finances is to take a look at what money is
coming in and how that may have changed since your loss.
You
may be facing lower income without your spouse’s salary, or you may have some
additional funds through a life insurance payout or inheritance.
It is really important to see where you are and
to then, once you have all of that information, start to create that new road
map for your family Stacy
Francis PRESIDENT AND CEO OF FRANCIS FINANCIAL
If
you have children under age 18, be sure to apply for spousal survivor benefits
from Social Security, Francis said. Also, make sure you are collecting
any life insurance money you may be entitled
to, so reach out to your loved one’s employer to see if there was coverage, as
well as any private insurers.
Another
potential source of money may come from any unclaimed funds. Do a search on
your state’s online unclaimed funds site for both you and your loved one.
4. Check your expenses
The coronavirus
pandemic has already hit people’s expenses. Losing a spouse will add to that.
You
may need extra childcare or therapy sessions. On
the other hand, you may see a decrease in some expenses, like a payment for a
second car.
List
everything and compare it to what you have coming in and see what needs to be
adjusted.
If
you have outstanding credit card bills, check with your
creditor. Many are already offering programs, like
payment deferments or a reduction in interest rate, to help people get through
the pandemic.
5. Navigate medical bills
If
you are left with high medical bills in the wake of your loved one’s death,
talk to a medical billing and health insurance expert, Francis advises.
That
can help you truly understand if these are bills you need to pay or if your
health insurance wasn’t billed properly, with the proper medical coding.
“We’ve
also seen some individuals be able to negotiate with their health insurance,”
she said. “They just want to get paid.
“The
last thing they want to do is have you declare bankruptcy.”
6. Take stock of finances
Get
an understanding of what your finances look like now.
That
includes retirement and brokerage accounts, your home’s value, your mortgage
and any other loans you may have.
Taken
together with your expenses and cash flow, it will help you form a plan for
your near-term and long-term future and could impact college, retirement and
the rest of your life, Francis said.
7. Your own estate plan
If
you lost your spouse and have children, appoint guardians as soon as possible,
even if you aren’t ready to take a look at your overall will and estate plan,
said New York-based estate-planning attorney Robert Steele.
When
things settle down, you can then update your will and beneficiaries on any
retirement plans or insurance policies.
“Your
will, your estate plan is going to most likely need to change, especially if
you have younger children,” Steele said.
That
includes creating a trust for your kids if they are young, so they don’t
receive the money outright, and naming a trustee to oversee it.
Additionally,
if you lost your spouse, he or she was likely your health-care proxy and had
power of attorney. You’ll have to choose another person “who you trust and
value,” Francis said.
In
the end, coming up with an overall plan will help you move forward both
emotionally and financially.
“While
it might be frightening and scary to look at all of this, it is really important
to see where you are and to then, once you have all of that information, start
to create that new road map for your family,” Francis said.
Disclosure:
NBCUniversal and Comcast Ventures are investors in Acorns.
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