By DANA ERICKSON
I recently had an appointment with a 58-year-old woman who is dealing with the unexpected loss of her husband. In addition to feeling tremendous grief, she has to manage the household finances on her own. Thankfully, she has a brother who is an accountant and a brother-in-law active in business to help her.
The financial advisor who handled her deceased husband’s IRA let her know that she had some paperwork to fill out and sign. She did not meet with the planner face-to-face, but he mailed her forms to look over and sign, and called her to discuss the forms. Unknowingly, this widow signed the papers she thought named new beneficiaries, but instead exchanged her deceased spouse’s contract into a new contract of her own, which wasn’t in her best interest in this case.
Her two financial advocates (who are family members) told her to simplify things and just continue the program her husband had started with his financial advisor in June of 2010. Unfortunately, her husband’s program was based on different parameters and financial information. Instead of simplifying things, this woman needed to review her current situation to make sure she was taking the correct course of action based on her present needs.
As I now review this woman’s financial situation, I am concerned about her retirement income and limited ability to continue working due to some health issues. The analysis of her current investment scenario shows that she will likely run out of income in future years – a situation that could have been prevented if she had sat down and fully reviewed her finances with an advisor upon the death of her husband.
This woman now has the stress of dealing with the loss of her spouse, but also the reality that her income sources might not be sufficient to meet her needs.
So, what could have been done to prevent the situation to begin with? If you are widowed, consider these tips:
n Seek professional help. Before you select a financial professional, interview a few of them, and ask plenty of questions.
n Bring your trusted advocates with you to meetings with your financial professional. By doing this, you ensure that they are hearing the same information being presented to you and can help you to ask questions and make decisions.
n Ask other widows about their experiences and opinions.
n Never sign anything unless you fully understand what you are signing. Do not be afraid to ask questions.
n Don’t rush into anything. If you are feeling pressure to make decisions quickly, stand up for yourself and ask for more time. Ask for clarification around the need to rush.
Dana Olson Erickson, ChFC, CASL, is a Financial Consultant with Thrivent Financial for Lutherans in Stillwater. She can be reached at 651-439-7091