In many families, one spouse takes primary responsibility for the family’s finances, doing everything from paying bills to making investment decisions to reviewing insurance policies. If that spouse dies first, the surviving spouse may have difficulty taking over these tasks. Therefore, if you take care of money matters in your marriage, one of your most important financial duties is to prepare your spouse to handle the family’s finances.
Some strategies to consider include:
- Maintain good records. Financial records should be well organized, located in one central place, and contain only pertinent information. Old or outdated information may confuse your spouse.
- Prepare written instructions. These instructions should cover everything from insurance policies to investments to company benefits to monthly bills, so nothing is overlooked. Also list all your assets, why you own them, and where important documents are kept. Update these instructions at least annually.
- Discuss your finances with your spouse. Go over your written instructions, explaining your rationale for major financial decisions. Your death could likely necessitate changes in investment allocations, insurance policies, and other financial matters, so encourage your spouse to explore all options before making decisions.
- Involve your spouse in the family’s finances now. Your spouse can start by paying monthly bills, balancing the checkbook, or reviewing credit card charges. Increase his/her involvement as confidence builds.
- Line up professionals for your spouse. Even if your spouse assumes some financial duties, there may be areas he/she will never feel comfortable handling. Identify those areas, find knowledgeable professionals who can help, and introduce your spouse to them now.
These strategies can help smooth the transition if your spouse needs to take over the family’s finances.