(reprinted from Decor and Style Magazine, June 2003)

Managing Your Feelings
and Your Finances in Widowhood
By Candace Bahr

When SARAH WILKES came in to talk with me last year, she had just been widowed the week before. Her husband's death had happened so suddenly, it was quite apparent she was still in shock -- and who wouldn't be? The problem was, Sarah already felt pressured to make critical financial decisions that would be difficult under even the best of circumstances and she was in an emotional fog

At 50 years old Sarah's husband Jack had been the picture of health -- lean and fit with an outgoing personality to match his strong frame -- which is why it was all the more shocking when he had a fatal heart attack after his morning jog. Doctors couldn't explain why someone with his excellent medical profile would suffer a cardiac arrest. Sarah didn't want an explanation. She just wanted her husband back.

During our first meeting, Sarah told me about her family. She and Jack married in their early 20s, and had raised two beautiful sons together. When they were newlyweds, Sarah worked as the office manager at a local law firm, but she left her job after they decided to start a family. Money was never a problem -- Jack earned an excellent living, and he managed the household finances well. But he also managed them alone. Instead of worrying about paying the bills, balancing the checkbook, or what investments the couple held, Sarah was busy planning meals, helping the boys with their homework, and attending PTA meetings. Now suddenly alone at age 48, she was not only grief-stricken and scared, but also entirely unprepared to take over her own financial affairs.

Of all the life events that trigger the need for financial advice, the death of a loved one can be one of the most significant. I often suggest widows wait six months to a year before making any big decisions about managing their assets• But there are some things that simply cannot wait. One of the most important immediate decisions you must make is to rally your support team together around you. Make sure you have competent professionals to help you with insurance and investment decisions, as well as the legal and accounting concerns. After all, it is your trusted advisors that will act as your advocates to help you through this difficult process.

You also will need to handle some basic financial tasks as you begin to reevaluate your new circumstances. Here is a brief overview of some of the initial concerns I discussed with Sarah. They are issues every new widow will have to confront:

Managing the paperwork. It is important to be organized at this time. Make a place on your desk or in your kitchen that you devote only to this type of paperwork• Be sure to obtain certified copies of your spouse's death certificate to provide to his former employer, life insurance carrier, and others, and gather up all of his personal and financial documentation, such as his birth certificate, marriage license, driver's license, stock certificates, tax records, bank statements, real estate leases or deeds, and outstanding debts. Also, contact his employer about retirement funds, deferred salary and bonuses, stock options, accrued vacation pay and any company insurance policies.

Eligibility for government benefits. As a new widow, you should apply for any veteran's or professional organization benefits for which you might qualify, as well as Social Security. Note, however, that unless you have children, the Social Security benefits will not begin until you are age 60. To find out how much income you will be receiving once eligible, call the Social Security Administration at (800) 772-1213.

How to hold title. If you have substantial assets, your advisors may suggest or implement additional strategies to minimize the potential estate taxes that may be due upon your eventual death. Don't assume just because you did a basic family trust prior to your husband's death that your planning is complete and going forward. Even if you don't have a lot, there are still some significant planning and tax issues that stem from how you decide to hold title to your assets now.

How to take insurance proceeds. You may have a choice between taking a lump sum, or leaving the funds with the insurance company and taking a guaranteed monthly payment for the rest of your life. Be sure to discuss your options with a seasoned financial professional to determine which distribution plan is best for you. Also, if you take a lump sum payment, don't invest the money without getting sound financial counsel first. Your financial advisor can help you structure an investment portfolio to meet your needs now and in the future.

Get support. As I began working with Sarah to simplify her financial situation, I also offered her support through the Women's Council at our firm. When difficult decisions need to be made it helps to have family members, friends, and trusted advisors as support. The Council is one more resource that is available. The volunteers on the Council arrange informal meetings between women who have already gone through these life-changing transitions. They can share their experiences to support, empower and mentor one another. Sarah also needed some referrals to other trusted advisors working in different disciplines to make sure a safety net of professionals was in place.

Well, it's been almost a year since we started working with Sarah and I'm happy to say, with each day that goes by she is making more and more progress. Understandably, it's taking a while, but she is now beginning to feel confident in her decision-making ability. She just bought a new car and negotiated the price and contract herself (with only a little help and encouragement from us).

Through an on-going financial planning process, we determined what Sarah needed to live comfortably for the rest of her life and have been conservatively investing the proceeds of her husband's insurance policy and reallocating parts of her portfolio to help her work toward those goals. She now feels at ease with the decision making process. We review her situation periodically, and will adjust her portfolio if her circumstances change. Just recently, she told me she's actually begun to entertain the thought that she could go back to school and perhaps get a law degree! She's still not ready to do it, but at least she's thinking toward the future.

As a result of her increasing confidence and the stability of her financial situation, she has begun gifting money to her sons and their wives to help them as they start out their lives together. Her first grandchild is on the way and she is excited about starting a 529 plan for his education.

As I look back on Sarah's first desperate months after her husband's death, it's hard to believe how far she's already come. She still feels lonely each time she walks into her home and it's empty. She feels sad that their grandchildren won't know Grandpa Jack. And, she says, it's embarrassing when she seems to suddenly cry for no reason.

Candace Bahr is managing partner of Bahr Investment Group in Carlsbad. (Securities and financial planning offered through, Linsco Private Ledger a registered investment advisor member SIPC.) She is a financial consultant with more than twenty years of experience in the San Diego area and is the co-founder of the non-profit Women's Institute for Financial Education (WIFE.org).