In the wake of losing a spouse, many older individuals find themselves grappling with not only emotional turmoil but also unexpected financial challenges.
Karen Lauer, who lost her husband without a will, experienced a financial spiral compounded by grief. Without a clear estate plan, she found herself entangled in legal battles over her late husband’s assets. This situation is not unique; over 2,000 older Americans have shared their regrets with Business Insider, many of whom experienced significant financial setbacks post-bereavement.
The absence of a will or life insurance policy has left some widows in complex legal entanglements or with reduced household incomes. One widowed survey respondent expressed regret over not saving for retirement while another wished she had prepared better for life after her husband’s passing. Lauer herself described the ordeal of dealing with her husband’s estate without a will, likening it to going through a divorce with her deceased spouse.
The economic reality for many widowed retirees is daunting. Data from the Census Bureau’s 2023 Survey of Income and Program Participation indicates that widows generally have lower 401(k) balances and savings compared to their married counterparts. While their average monthly income of $2,381 surpasses that of divorced or never-married retirees, it falls short of what married retirees typically receive.
Financial expert Doug Ornstein highlights the severe impacts that the loss of a spouse can have on financial stability. Without adequate financial literacy or if they have underprepared for retirement, surviving spouses are left to navigate these challenges alone. A recent Thrivent report found that less than half of widowed women felt equipped to manage their finances post-loss, underscoring the urgent need for financial planning in marriage.
Lauer’s reflections reveal a desire for better preparation and highlight the necessity of having a will and financial plan. Additionally, creating a life-insurance policy and engaging in regular financial discussions are recommended to enhance security. Ornstein advises widows and widowers to seek professional guidance from estate planners or financial advisors, as this can provide substantial support and clarity during challenging times. Gathering crucial documents and reassessing benefits are essential steps in this process.
The case of Robert Berkeley exemplifies a different perspective—one of no financial regrets despite limited wealth. He chose to enjoy life with his wife Lourdes, living fully rather than saving excessively for future uncertainties. Although he now faces financial hardships after her passing due to the lack of a life-insurance policy or substantial savings, he holds no regrets over their past spending choices, valuing the memories created.
Ultimately, the stories of these older Americans illustrate the profound financial impact that the loss of a spouse can have. Proper planning, including writing a will and securing life insurance, is imperative to protect surviving spouses from financial distress. Their experiences serve as powerful reminders of the importance of preparation ahead of unexpected life events.
Source: Businessinsider
