In my last post, I suggested some new year’s resolutions you may want to consider. In this article, I want to carry that theme forward, but in a slightly different way.
Not too long ago, I read an article on the Center for Retirement Research website titled, “Husbands Ignore Future Widows Needs.”
As I read the article, it occurred to me that there are several ways a husband (although they could apply to a wife as well) can “love their widow (or widower).”
I don’t want to be morbid, but the reality is that one of you is almost certainly going to outlive the other. And it’s also very possible that the surviving spouse could live a very long time. (Actuarily, the lifespan of at least one spouse in a couple is 89 years.)
Therefore, since one of you may live a long time, there are things you can do now to love your future widow or widower in the future:
Loving them through wise planning
The main focus of the article was the wisdom of optimizing Social Security benefits over the long term—particularly for the sake of widows who may live a long time in retirement without their husbands.
We tend to think about optimizing retirement income while we are here (presumably to enjoy it) and don’t always give enough thought to what our surviving spouse may be facing after we’re gone.
The article noted that,
Previous research has shown that a large minority fail to take their wives into account when deciding to start their Social Security. A new study confirms… Regardless of the way the survivor benefits were displayed, the men weren’t persuaded to postpone their own benefits to one day help their widows. Potential explanations include their feelings about work, existing health issues, and whether they will get a defined benefit pension from an employer.
The article also said,
… an average widow’s total income drops 35 percent when a husband passes away… The earlier the husband had started his benefits, the larger the drop in the widow’s income after the couple’s second Social Security check stops coming in.
The more dependent you and your spouse are (or will be) on Social Security to provide a significant percentage of your income in retirement (studies show that percentages generally range from 40% to 70%), the more critical this becomes.
Taking the “long view” when making Social Security claiming decisions is good stewardship because it’s loving toward the surviving spouse (which is typically the wife). The goal would be, since it’s within your ability, to ensure that your surviving spouse will be financially independent for as long as she (or he, if the wife was the primary breadwinner) lives.
There are other ways to love your widow/widower. I previously wrote an article titled “Things you can do to pursue financial simplicity…” Simplifying and consolidating is something that can assist your surviving spouse and those who are helping her.
Maximizing guaranteed income sources (such as Social Security and annuities), having sustainable savings withdrawal rates automated, and having professionals in place to assist are other ways.
I wrote another article and estate planning and having all your final documents in place, especially your will (and trust if you need one), and also what I call a “final letter.”
Loving them with a “final letter”
I want to inject another “loving toward your widow or widower” gesture into this conversation: the “final letter.” I have written about this previously in an article titled “Estate Planning and Your Will.” I described it this way:
The letter contains all the details that my wife, and/or an executor or personal representative needs to know if I am gone or incapacitated. The letter is not a legal document per se,’ and the information changes more frequently than the information in my will, so it makes a lot of sense for it to be a separate document.
You can use these documents to cover such things as, among others: the probate process, the locations of wills/essential documents/valuables, final care wishes, gifts, computer and online account access, inventory of assets, account management, and cash flow, insurance policies in force, business transition, investment management including lifetime income, and recommended contacts.
I can’t stress strongly enough how important this is, especially for whichever spouse is the finance “nerd” in the family. This document is an “open after I’m gone” letter. Most people don’t ever write this letter because they don’t want to think about the end of life, or because they don’t know where to start. (It is strange writing a letter while imagining that you are dead.)
In addition to some tongue-in-cheek comments here and there (who wouldn’t want a chuckle if they had to read a letter like this), I mainly provided information and instruction on our financial (banking and investment) and insurance accounts. But I also offered some miscellaneous information, such as information on where this blog is hosted, etc., and other online services that I use, such as my cloud accounts. Some accounts and valuables may be listed in your will or revocable living trust, but many are not.
Also, the typical estate planning documents do not have contact information for your professional advisors, usernames, and passwords for your accounts, or notes and instructions. You ought to specify the location and approximate value of your important possessions. Your major accounts may have named beneficiaries, but what about sentimental pieces like jewelry, art, or vehicles. Specify exactly which sentimental items go to whom (if you didn’t already do in your will). Your Financial Inventory will make things much easier for your surviving spouse and/or your other beneficiaries. However, it will also prove to be a valuable tool for you by forcing you to organize your financial life.
You would keep a copy of the letter at home with your estate planning documents and one with your attorney. Storing it in a safe deposit box might make it difficult for your beneficiaries to access it. Update the letter frequently to make sure it says what you want to say. I update mine every year or two. I keep a copy in my fire safe at home and another in my cloud account.
After I published that article, a kind reader wrote me and asked if I could share the framework of my letter as a kind of template that others might use.
Since its a new year, and I want to STRONGLY URGE any who have not done so to write such a letter, I’ve decided to help you get started. Here is a link to my actual letter, with all personal/confidential data redacted. It will give you an idea of the things I included in my letter and hopefully help you to write your own. My letter is almost six typewritten pages as I have included a lot of detailed information, instructions, and suggestions specific to our situation (which, of course, are not in this sample).
Your situation may be very different from mine, so your letter (and expressed wishes and desires) will be different. But my letter will give you an idea of the scope of the document and some of the specific content I chose to include. My hope and prayer are that it will inspire you to write your own, “Letter From Your Husband Who is Now (or almost) in Heaven.” Your surviving spouse may one day thank you for that act of love while you were still on this earth.