Widowhood: The Loss Couples Rarely Plan For—And Should


Staff report

No one is ever emotionally ready for the death of a spouse. But you can prepare financially for the decision-making, and possibly reduced income, you may someday face. As a continuation of its recent study “Women and Financial Wellness: Beyond the Bottom Line,” Merrill Lynch conducted research in partnership with Age Wave on widowhood. The study found that 78 percent of the 20 million US widows/widowers are women. That means that women are 3.5 times more likely to become widowed.

We sat down with Rachel Barzilay, CAP®, CFP®, CRPC®, Managing Director, Wealth Management Advisor and Senior Portfolio Manager with Merrill Lynch Wealth Management in Boca Raton, to discuss the study and its findings.

Why was this study conducted?

Longevity needs to be a factor in everyone’s financial planning, but far more so for women, who, on average, live five years longer than men. By age 85, women outnumber men two to one and the majority (81 percent) of centenarians are women.

This means that women are more likely to be alone and financially self-reliant in their later years, perhaps having already spent some of their nest egg on a partner’s health or end of-life care costs.

To better understand this profoundly difficult—but for most couples inevitable—life event, Merrill Lynch partnered with Age Wave, a thought leader in the study of aging, to conduct research on widowhood and how this loss can affect the surviving spouse’s life and finances.

What would you say is the key take-away from this study?

Among the key findings: Men and women who prepare for losing a spouse fare much better in terms of stress and grieving, but a full 53 percent of current widows and widowers say they had no plan in place for what to do if one of them died.

The financial burdens that come with the loss of a partner are immense and immediate. According to the Merrill Lynch/Age Wave research, 60 percent of men and women who lose their spouses are immediately burdened by financial expenses, including housing costs such as mortgages or rent. The fact that 50 percent of those who lose a spouse also face a 50 percent reduction in income only compounds the problem.

In addition to the financial demands, critical paperwork and decision-making begin their steady creep right away. Most widows and widowers—78 percent—describe the loss of their spouse as the single most difficult and overwhelming life experience. And two-thirds say that they had so many things to do, they were not sure where to even start.

That’s when help from a knowledgeable professional can be invaluable.

What are some tips for someone who needs to move forward alone?

Don’t be afraid to ask for help. The right team can be invaluable as you deal with the financial and legal challenges of becoming the sole financial decision maker. Having a trusted financial advisor, attorney and tax professional in your corner can make a big difference as you move on alone.

Reassess your retirement needs. Reviewing your retirement needs can help you make any necessary adjustments. Work with a financial advisor to come up with a plan so you can move ahead with confidence.

Gather and file all necessary paperwork. Obtain several copies of the death certificate. You’ll need them to share with financial institutions and when filing for survivor’s Social Security and life insurance. Be sure you have any other relevant documents as well, including birth and marriage certificates, wills, trusts and tax returns.

Gaining financial confidence can help sustain you through a difficult time. Amid all the pain and difficulty that losing a spouse brings, there is also healing. The Merrill Lynch/Age Wave research found that 77 percent of the widows and widowers they interviewed said they discovered courage they never knew they had.