A Death in the Family: Being Financially Prepared


What would happen to your family’s finances if you or your spouse were to die unexpectedly? Would it be easy for the surviving loved ones to get back on their feet financially? The Virginia Society of CPAs offers these tips to ensure that your family is financially prepared to cope with a death in the family.

Write a will

Everyone should have a will that is kept in a secure location, such as your lawyer’s office or a fireproof home safe, and that is easily accessible if a death should occur. Wills are not just for the rich. They are important legal documents that ensure that your wishes are carried out and that your family can gain access to their inheritance without unnecessary delays.

Keep your documents in order

It will be important for a surviving spouse to be able to write checks, apply for any available insurance or pension benefits and assess the family’s overall financial situation. That’s why it’s best to make a habit of keeping your financial materials in order so that family members can get their hands on the documents they need in an emergency. It’s a good idea, for example, to keep a list of checking and savings account numbers, investment account information, life insurance policy details and any other particulars that will clarify your financial situation.

Stay informed

In many cases, one spouse has been in charge of the family finances and the surviving spouse has no idea where the family stands after a death. Lists of important account details are particularly important in this situation. But it may also be a good idea to leave instructions, as well, that provide information such as the contact person at each financial institution and any other valuable information about the account. Consider, too, listing your important assets — such as your home or savings and investment accounts — and your regular liabilities, including the amount of the mortgage payment or other bills. This information will help the surviving spouse begin to actively manage the family finances.

Check your Social Security benefits

Your family members may be eligible to receive Social Security survivor’s benefits if you have paid Social Security taxes and earned enough credits to qualify. The rules are complicated, but generally survivor’s benefits can be paid to a spouse who is age 60 or older (or 50 or older if disabled) or to any spouse or ex-spouse who is caring for your child who is under 16 or disabled. Ex-spouses over 60 (or over 50 if disabled) are also eligible if the marriage lasted at least 10 years. Unmarried children under 18 (or under 19 if attending up to grade 12 full time) also qualify, as do dependent parents age 62 or older. You can learn more at the Social Security Administration website at www.ssa.gov or by calling (800) 772-1213.

You should contact Social Security immediately after a spouse dies if you believe you qualify. Also remember that a surviving spouse — or your children if you’re not married — may be eligible for a lump-sum benefit upon your death.

Turn to your CPA

If you are struggling to restore financial order after a death in the family, your local CPA can help you regain your financial footing and address the issues facing your family. Your CPA can also advise you on the best steps to take now to ensure your family is in good financial shape in the event of a tragedy.

The Virginia Society of Certified Public Accountants (VSCPA) is the leading professional association dedicated to enhancing the success of CPAs. Founded in 1909, the VSCPA has 9,000 members who work in public accounting, industry, government and education. For general information, please visit the Press Room on the VSCPA website at www.vscpa.com, e-mail vscpa@vscpa.com or call (804) 612-9424. To search for a CPA in your geographic region, visit www.financialfitness.org and click on “Find a CPA.”

©American Institute of Certified Public Accountants

LAST UPDATED 3/6/2010

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