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Picking up the financial pieces after a loss: 'We planned life but we didn't plan death'

Brenda Pickens and her late husband, Howard.
Source: Brenda Pickens

It wasn't supposed to happen this way. 

When 63-year-old Howard Pickens died suddenly of complications from Covid-19 in March, his wife Brenda was stunned. Not only had she lost her companion of almost three decades, she now had to figure out how to get by on her own.

"We planned life but we didn't plan death," said 62-year-old Brenda Pickens, who lives in Waveland, Mississippi.

"I don't know where our heads were at," she added. "He was never going to die and life would just go on."

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Howard owned a barbershop, Fade 1, in nearby Bay St. Louis, and the couple owns an RV. Brenda, who was also out of commission for two months fighting the virus, is now trying to sell both in order to come up with some cash. A retired nurse, she is currently on furlough from her job at a barbershop on a nearby naval base. She's getting a paycheck, but it was the tips she really relied on.

"Now I'm stuck with having to revamp plans, just for survival," she said. "Just to be able to survive."

The couple had only a small life insurance policy and some retirement savings, according to Pickens.

Luckily, she has gotten a mortgage forbearance for a few months and is using the money she's saving on that to pay the bills.

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"I'm very concerned," she said. "It is all of the 'what ifs.'

"What if I get pink-slipped and no longer have a job?" Pickens continued. "I would have to sell my house, plus look for another job of some kind. There are so many unknowns."

However financially prepared, or unprepared, you may be, losing a loved one is overwhelming. Not only are you dealing with grief, but there are financial decisions that must also be made.

Take a pause

"It might be tempting to make a lot of decisions all at once," said certified financial planner Stacy Francis, president and CEO of Francis Financial in New York and a member of the CNBC Financial Advisor Council.

That may mean moving to a new place, selling a house, going right back to work and taking a new job.

Her advice: Don't do it.

"Give yourself a little bit of a pause so that you have time to allow yourself to start the grief process and that you give yourself time to navigate this new normal for yourself," she said.

"When you have been through trauma, it is very hard to think clearly."

Seek help

Justin Lewis

Finding professional support — through, for example, a grief counselor or therapist — can help you navigate the mourning process. A financial expert, meanwhile, can help you through money issues concerning insurance, wills, debt and the like.

"Put yourself on a path of not only recovery, but to eventually be able to rebound," said Francis, who specializes in working with widows and widowers and is a certified grief recovery specialist in The Grief Recovery Method approach.

Once you are ready, you can review your finances and reset.

Understand your cash flow

The first thing to do is to take a look at money coming in and how it may have changed since your loss.

You may be facing lower income without your spouse's salary, or you may have some additional funds through a life insurance payout or inheritance.

It is really important to see where you are and to then, once you have all of that information, start to create that new road map for your family
Stacy Francis
president and CEO of Francis Financial

If you have children under age 18, be sure to apply for spousal survivor benefits from Social Security, Francis said. Also, make sure you are collecting any life insurance money you may be entitled to, so reach out to your loved one's employer to see if there was coverage, as well as any private insurers.  

Another potential source of money may come from any unclaimed funds. Do a search on your state's online unclaimed funds site for both you and your loved one.

Check your expenses

The coronavirus pandemic has already hit people's expenses. Losing a spouse will add to that.

You may need extra child care or therapy sessions. On the other hand, you may see a decrease in some expenses, like a payment for a second car.

List everything and compare it to what you have coming in and see what needs to be adjusted.

If you have outstanding credit card bills, check with your creditor. Many are already offering programs, like payment deferments or a reduction in interest rate, to help people get through the pandemic.  

Navigate medical bills


If you are left with high medical bills in the wake of your loved one's death, talk to a medical billing and health insurance expert, Francis advises.

That can help you truly understand if these are bills you need to pay or if your health insurance wasn't billed properly, with the proper medical coding.

"We've also seen some individuals be able to negotiate with their health insurance," she said. "They just want to get paid. The last thing they want to do is have you declare bankruptcy."

Take stock of finances

Get an understanding of what your finances look like now.

That includes retirement and brokerage accounts, your home's value, your mortgage and any other loans you may have.

Taken together with your expenses and cash flow, it will help you form a plan for your near-term and long-term future and could impact college, retirement and the rest of your life, Francis said.

Your own estate plan

If you lost your spouse and have children, appoint guardians as soon as possible, even if you aren't ready to take a look at your overall will and estate plan, said New York-based estate-planning attorney Robert Steele.

When things "settle down," you can then update your will and beneficiaries on any retirement plans or insurance policies.

"Your will, your estate plan is going to most likely need to change, especially if you have younger children," Steele said.

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That includes creating a trust for your kids if they are young, so they don't receive the money outright, and naming a trustee to oversee it.

Additionally, if you lost your spouse, he or she was likely your health-care proxy and had power of attorney. You'll have to choose another person "who you trust and value," Francis said.

In the end, coming up with an overall plan will help you move forward both emotionally and financially.

"While it might be frightening and scary to look at all of this, it is really important to see where you are and to then, once you have all of that information, start to create that new road map for your family," Francis said.

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