Death and Taxes

Well, not taxes specifically but money, for sure, which affects taxes and I ran out of better ideas.

One evening last week, I attended an event of a local non-profit, Elders in Action. Since 1968, they have worked in a variety of ways to create an age-friendly community in and around Portland, Oregon and since 1993, they have carried out a certification program businesses can take advantage of to meet the group's best practices criteria for helping out elders.

Each year, Elders in Action publishes a directory of age-friendly businesses, a list that now numbers more than 1,000.

None of that is here nor there except that today's post is a result of my attending the Elders in Action meeting and it's always a good idea to mention what works well.

At this event, I met a young woman, Sandra Wagner, an independent financial consultant who lives and works in Portland, Oregon. (She was hard to miss, having in tow her toddler-age daughter – a remarkably well-behaved kid in a room full of grownups.)

About half of Sandra's practice falls into the category of “sudden wealth” which doesn't mean winning the lottery (although I suppose it could).

In Sandra's case, it usually applies to the financial situation of a survivor when a spouse dies and what both shocked me and piqued my interest is that many of Sandra's clients have no knowledge of the family finances.

One widower, who chose to have his wife cremated because it was less expensive than burial, struggled to get by day-to-day for 14 years until he was notified that his wife's life insurance policy was about to lapse. The man had had no idea the policy existed and with Sandra's help was able to improve his financial situation.

The opposite happens too – when survivors believe there is a lot of money or think money goes further than it does and spend beyond their means leaving fewer choices later in life when reality becomes evident.

These things happen when one-half of a couple handles the family money and the other half pays no attention due to disinterest or because the spouse does not want to burden him or her.

Many years ago, when I was still married, my father-in-law died suddenly and unexpectedly at age 60. His wife, my mother-in-law, had no clue, not one, of family finances: nothing about bank accounts, life insurance, if there was a mortgage on the house, credit cards beyond the one she carried with her and she did not even know the combination to her husband's locked briefcase. It took weeks to unravel it all.

This is not uncommon today and Sandra confirmed my guess that although not unknown among young adults, these difficulties turn up mostly among older women – the age group of many Time Goes By readers.

Although it might also be a good guess that a financial consultant like Sandra is dealing with well-off clients who have a variety of investments, trusts and other complications of wealth, some of Sandra's clients have little more than Social Security and, perhaps, a small pension. They need advice for such difficulties as, for example, figuring out how to pay for a new roof on the house.

Either way, family financial records need to be easily and quickly available when we die and Sandra has some good advice so that our spouse or designated person to handle our affairs won't be as knee deep in ignorance as I was when my father-in-law died.

Create a binder or other organized place, says Sandra, to keep all financial records in one place. Include the necessary information for:

Bank accounts
Credit card accounts
Mortgage accounts
Outstanding loans
Insurance policies
Investment accounts
Other financial assets
Safe deposit box

Other useful information could be your will, a household inventory, accountant's name and contact information and attorney's name and contact information

Important: Because increasing amounts of banking and finance are going paperless, be sure to include IDs and passwords for those accounts and keep it all in a safe place.

Update the information as needed and be sure your spouse, adult children, other family member, friend or whomever will handle your affairs at your death knows where to find this information. It will make their life so much easier during what will be a difficult time for them.

It was fun to hear about a burgeoning cultural phenomenon from Sandra: that although it is mostly women in older generations who lack knowledge of household finances, there are growing numbers of young men who are clueless.

This occurs, says Sandra, when the primary breadwinner in a marriage is the woman earning, for example, six figures and the husband earns maybe $30,000 to $40,000. These men tend to hand off family finances to their wives.

At The Elder Storytelling Place today, Marcy Belson: Living in the Desert


Thanks for the reminder to update. My husband has changed jobs since we built our binder, and I know his retirement information has changed.

I'm a widow, but I handled all our finances when my husband was alive. I would try to explain bills, etc to him, but he just wasn't interested. Had I died first, he would have been almost clueless.

I didn't have much difficulty with finances after he died, since I managed it all. I was also very aware of the dire financial situation some widows/widowers find themselves in, due to my father having died at 42, leaving no insurance and/or few assets.

Once married, I made sure I would have income, savings and life insurance IF my husband died first. As a result, I don't have to work at age 60, have no debt, a comfortable income and savings. I've also prepared all the necessary info you mentioned, and it's in my safe deposit box (for my younger sister who will take care of things when I die).

Excellent post today, something for everyone to think about.

We have the planning problem of extreme complexity. My husband is the main one who deals with the finances but I know what they are. I don't know it all, and it changes so fast as we have five totally separate areas to manage-- that which is our own personal living, farm costs and sales, his businsses, investments, and our rental house in Tucson. The investments are managed by a financial planner who we direct as to the type of investments, but mostly he deals with it. The businesses where he consults are often not making money, do involve his moving money around for equipment, sales and a few part time employees. They also have have stock options etc. for future possible profit... argh!. The farm is a daily thing with little resembling a more orderly type of business. It's chaotic. With all this, we do have an accountant who serves as an adviser at times and still does the taxes. We began that when my husband got into consulting work. It's not like a regular paycheck for how it all works out.

I know very little about the daily operations of much of this other than where everything is and a kind of overview when I take time out to ask for it (there isn't much I hate more). I reminded him that our son, who will be our executor, might have less idea of what's what if something happened to both of us at the same time-- something that can happen with travel.

Thinking about money is one of the things I dislike the most. But I know you are right. We even have cemetery plots that we bought when our parents died. We won't either one be buried there because we want to be cremated with ashes sprinkled somewhere or buried in the ground maybe on the farm here if we are still living here when the need arises. I vary where I might want them thrown out if that ends up being the situation. We will not stay at this farm until old old age. I think through our 70s (with no big health problems for either of us), we can stay and then should move onto something more accessible to doctors and with less hard work attached. If something happened to my husband now, I would have to hire someone or move very soon as it's big muscle and strength jobs that I simply could not do anymore-- working smarter and wiser or not!

Aside from not having a farm to run, my situation is similar to Rain's. I find all things financial maddeningly dull, and my husband loves that stuff, so he handles everything. He recently turned doing the tax returns over to an aocountant, and we have a binder, which I make myself review every month. It has the keys to the safe deposit box, passwords, etc. We are trying to simplify our finances, getting rid of some so-called assets that don't make us any money. He is younger than I, so I am counting on him to stick around and if possible outlive me!

Thanks for the reminder. I do all the financial stuff, a lot of which involves online accounts, etc. Though my husband is 7 yrs older than I, stuff happens. I could die first and leave him in financial limbo, though his retirement check would keep coming. My computer has a sticky-note app which gets in my face to remind me of things I need to do. It's now telling me to get lists etc together so someone could help him deal.

Thanks. Today's blog reminds me that it's time to further "tune up" my/our affairs. I always managed the money, but the big stuff like investments & purchases we did together. Now it's just me & I'm doing well with some help from my daughter (5 yrs on Wall street)who's very knowledgeable. We are "ok" as long as something medically catastrophic doesn't come up. I find that denial is the best coping tool I have:) Dee

This is excellent advice I'd highly recommend to everyone at any age with few, if any, or many assets -- accidents happen, too. Single individuals need to arrange such info for whomever they have selected.

I recall a very computer literate friend who had just been diagnosed with early stages of M.S. She and husband had retired only a few years earlier from IRS. He was heavily into investing via the computer, then suddenly died. She was at a total loss, without passwords to any of his Internet accounts, knowledge of his investing information and I don't know how much other business info. She was distraught and overwhelmed with everything.

My husband died unexpectedly a few years later. Fortunately, he left all the information I needed, plus a lengthy hand written outline listing everything. When my son arrived from out of state he simply took the list and readily handled all the items he could though he had been somewhat unfamiliar with the specifics of our business. If I had needed to do it all myself I'm sure I could have.

My husband and I had exchanged the handling of our business affairs back and forth throughout our 42+ years wedded life based on the varying demands of our changing responsibilities. We each kept the other informed overall as warranted, so neither of us would be totally in the dark. After he died I was deeply involved in preparing the income taxes -- nothing I did could have completely informed me more than that process. He had been handling the affairs for many years prior to that.

Both spouses/partners absolutely need to be knowledgeable about all business affairs, or the one left living will be faced with complications they don't want, especially during an already difficult period of time. They also may regret not being so informed if they have to hire somebody to try and sort it all out.

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Your comment could not be posted. Error type:
Your comment has been posted. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.


Post a comment

Your Information

(Name and email address are required. Email address will not be displayed with the comment.)