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The death of one’s spouse is a critical issue for which many people fail to plan. 53% of widows say they and their spouse did not have a plan for what would happen financially if one of them died. 76% of married retirees say they would not be financially prepared if their spouse died. Please understand that the death of a spouse can have a devastating effect on household income. The decline can be as much as 50% to 100%. Are you prepared for that?

It doesn’t matter if you are in your twenties, forties, or seventies, it can happen to anyone at any time. My son’s wife died of pancreatic cancer when she was 39. In a recent study, the average age of a widow was 57. 80% of men will die while they are married. On the other hand, 80% of women will die while they are single. So, don’t think that this is a retirement issue.

The obvious answer to this is proper planning, but people do not like planning or discussing death. If you need help, consider talking to a qualified, trusted, and competent advisor who is a Certified Financial Fiduciary, which means they are not only morally, but legally responsible for looking out for YOUR best interest. Such an advisor should be equipped to provide you with a comprehensive financial evaluation and plan. You must plan with the end in mind because if you don’t, it can have catastrophic effects on your financial future. This bit of advice goes for anything you do in life, from college planning, retirement planning, to business exit strategies.

One of the most significant decisions is, do you have enough life insurance? What is the amount needed in case of an unexpected/premature death? A Financial Professional who is a Certified Financial Fiduciary can quantify how much to purchase using any number of methods such as: human life, financial needs, and capital retention. Whether it is term or Cash Value Life Insurance, you must have it in place to protect your family. Remember: insurance is the only product, for pennies on the dollar, that will make happen what you want to happen for your family if you pass away. Cash Value Life Insurance is the ONLY financial vehicle available that will protect your family with the tax-free death benefit if you die too soon, give you tax-free income for life through policy loans, and protect you with long-term care options through the critical, chronic, and terminal illness riders. NO OTHER FINANCIAL PRODUCT CAN DO THIS!

The bottom line and key to properly planning for the death of a spouse is to determine what the available financial resources are and calculate the financial needs. Then plan on the best way to maximize those resources while getting additional ones through government benefit programs. Another crucial factor to consider is the taxation of any type of investments that you are contemplating. There is no assurance when it comes to the increase and/or decrease of taxes, so be aware! We have a 20 trillion-dollar deficit, Social Security and Medicare are scheduled to run out of money, and by 2030 all Baby Boomers will be over the age of 65. Given these statistics, who do you think the government is going to tax? Let me tell you, the 10% of us that pay 90% of the taxes.


Written by Alan Porter