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A reader writes: I lost my husband and soul mate two months ago. I am attending group support meetings weekly, seeing a psychologist weekly, and following up with my primary care doctor monthly. I mainly feel like I don't know what I'm doing most of the time but the people around me are telling me that I am doing things in a positive way. I'm returning back to work slowly as I work in the medical field and I feel that I need to have good, clear judgment and be able to concentrate in order to perform my job effectively.
In the weeks since my husband’s funeral I’ve had dozens of forms to fill out, certificates to send away, accounts to close and all the rest of the paperwork that needs to be attended to, but I have been blindsided by one question in particular.
I’ve been told that my husband’s life insurance policy comes with strings and I have to make a choice between two options: Take a lump sum payment and be done with it, or take the monthly income for two years and for life after that if I stay single. The monthly income stops if I live with someone or remarry. The numbers are not the same. The lump sum is obviously different. If I invest that, it wouldn't get the same income generated to compare with the monthly income for life.
It seems to me every step and decision I make I take a step further away from my husband. I think my problem is not the forms I have to fill in, it's more the fact that each time a new situation presents itself I have to think into the future and it brings it home I'm no longer a team. This really hurts.
My response: I am so sorry that you are faced with such a difficult decision at this point in your grief journey, my dear, and I can only imagine how overwhelmed you must feel. Ordinarily you would be turning to your husband for guidance in such matters, and of course in situations like this you're more acutely aware of his absence. I also appreciate that decisions like this have long-term consequences, which make it even harder to know what to do. That is why, in circumstances like this, I would encourage you to ask an expert: someone you can trust, who is knowledgeable about the subject at hand.
This is not my area of expertise, but since my eldest son happens to be an insurance agent (and one I know I can trust), I've shared your life insurance questions with him and this is his response to the situation you described. (He writes as a well-qualified and highly regarded life insurance agent with 27 years' experience in assisting clients with death claims):
Unfortunately our industry does not do a very good job when it comes to providing counsel to survivors when they have benefits coming their way after a death. It is true that some important (and long lasting) decisions need to be made with regard to the receipt of those benefits. The true value in an insurance policy is the relationship the insured has or had with the agent that sold them the policy in the first place. A good agent will take the time to get to know their client's needs before placing coverage so that when a tragedy strikes, a plan can go into action. Hopefully, when the time comes to pay those benefits, the agent is still involved and can give guidance on what is the appropriate next step. The carrier I represent will place life insurance benefits in an interest-bearing checking account that the beneficiary can use at their discretion (i.e., pay for immediate expenses, transfer to another account, etc). The point is they have 100% access and control at all times. I counsel my clients not to make any immediate decisions that have long term effects until about 6 months after the death of their loved one -- thereby avoiding any rush decisions that were made in the cloud of their grief.
Your reader indicates that she is facing some immediate decisions with regard to a payout stream vs. a lump sum. Without knowing the particulars of the contract her spouse bought, I find it VERY unusual for an income option to be contingent on whether she remarries or takes on a new life partner. I have NEVER heard of such a thing in 27 years of assisting with death claims. Again, without knowing her circumstance, I would advise she take the lump sum option ( giving her 100% control) and place it in a liquid account (like a money market fund). I would then advise that she seek counsel from a professional financial advisor that she trusts to make any long term investment decisions.
I think my son's advice is sound: Don't make any decisions right now, until you've obtained some solid financial advice, either from a trusted and respected relative or friend, or from a certified professional financial advisor.
You might also take a look at some of the Related Articles and Resources I've listed at the base of this post, which I hope will help ~ although I understand completely that you may not be ready, willing or able to absorb the information.
Your feedback is welcome! Please feel free to leave a comment or a question, or share a tip, a related article or a resource of your own in the Comments section below.
It seems to me every step and decision I make I take a step further away from my husband. I think my problem is not the forms I have to fill in, it's more the fact that each time a new situation presents itself I have to think into the future and it brings it home I'm no longer a team. This really hurts.
My response: I am so sorry that you are faced with such a difficult decision at this point in your grief journey, my dear, and I can only imagine how overwhelmed you must feel. Ordinarily you would be turning to your husband for guidance in such matters, and of course in situations like this you're more acutely aware of his absence. I also appreciate that decisions like this have long-term consequences, which make it even harder to know what to do. That is why, in circumstances like this, I would encourage you to ask an expert: someone you can trust, who is knowledgeable about the subject at hand.
This is not my area of expertise, but since my eldest son happens to be an insurance agent (and one I know I can trust), I've shared your life insurance questions with him and this is his response to the situation you described. (He writes as a well-qualified and highly regarded life insurance agent with 27 years' experience in assisting clients with death claims):
Unfortunately our industry does not do a very good job when it comes to providing counsel to survivors when they have benefits coming their way after a death. It is true that some important (and long lasting) decisions need to be made with regard to the receipt of those benefits. The true value in an insurance policy is the relationship the insured has or had with the agent that sold them the policy in the first place. A good agent will take the time to get to know their client's needs before placing coverage so that when a tragedy strikes, a plan can go into action. Hopefully, when the time comes to pay those benefits, the agent is still involved and can give guidance on what is the appropriate next step. The carrier I represent will place life insurance benefits in an interest-bearing checking account that the beneficiary can use at their discretion (i.e., pay for immediate expenses, transfer to another account, etc). The point is they have 100% access and control at all times. I counsel my clients not to make any immediate decisions that have long term effects until about 6 months after the death of their loved one -- thereby avoiding any rush decisions that were made in the cloud of their grief.
Your reader indicates that she is facing some immediate decisions with regard to a payout stream vs. a lump sum. Without knowing the particulars of the contract her spouse bought, I find it VERY unusual for an income option to be contingent on whether she remarries or takes on a new life partner. I have NEVER heard of such a thing in 27 years of assisting with death claims. Again, without knowing her circumstance, I would advise she take the lump sum option ( giving her 100% control) and place it in a liquid account (like a money market fund). I would then advise that she seek counsel from a professional financial advisor that she trusts to make any long term investment decisions.
I think my son's advice is sound: Don't make any decisions right now, until you've obtained some solid financial advice, either from a trusted and respected relative or friend, or from a certified professional financial advisor.
You might also take a look at some of the Related Articles and Resources I've listed at the base of this post, which I hope will help ~ although I understand completely that you may not be ready, willing or able to absorb the information.
Your feedback is welcome! Please feel free to leave a comment or a question, or share a tip, a related article or a resource of your own in the Comments section below.
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Related Articles and Resources:
- 7 Financial Tips For Your First Year As A Widow
- Expert offers financial advice for the recently widowed
- Loss of Financial Security
- Moving Forward On Your Own
- Preventing Identity Theft After A Loved One Dies
- Resources for Young Widow(er)s
- Surviving A Loss: Smart Steps for Coping With Widowhood
- Surviving Spousal Loss: Financial Concerns in Widowhood, Part 2
- Use This Executor's Checklist to Smooth Estate Transitions
- What Widows Should About Know About Financial Advisors
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