Love and Loss: How Death of a Spouse Can Affect Your Finances

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.

Editorial Note: This content is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by the financial institution.

death of a spouse
Logo

We’ve got your back! Student Loan Hero is a completely free website 100% focused on helping student loan borrowers get the answers they need. Read more

How do we make money? It’s actually pretty simple. If you choose to check out and become a customer of any of the loan providers featured on our site, we get compensated for sending you their way. This helps pay for our amazing staff of writers (many of which are paying back student loans of their own!).

Bottom line: We’re here for you. So please learn all you can, email us with any questions, and feel free to visit or not visit any of the loan providers on our site. Read less

When you take your marriage vows, you make a commitment of “till death do us part.” Yet, when you’re young and in love, you might think that day is decades away and something you can push into the back of your mind.

Unfortunately, death can come at the most unexpected of times — not just when you’re old. And dealing with the death of a spouse can have a major impact not only on your life but also your finances.

Here’s one woman’s story about becoming a young widow, and how you can prepare financially for the death of a spouse.

Emily and Frank’s story

I met Emily Liedel, a freelance writer, and Frank Omier, an artist in Portland shortly after I moved there. We all bonded over our love of traveling, the Spanish language, and our passion for art.

A few years ago, I attended their wedding and celebrated their union. Then, about one year ago, I heard the heart-breaking news from Emily. Frank had passed away after a seven-month battle with lymphoma at the age of 43.

As if the death of a spouse wasn’t hard enough to deal with, Emily was now on her own to support their two-month-old child.

At 32, Emily was a widow. And as you can imagine, the emotional toll was all-encompassing. But there was a financial impact, too.

Handling finances after the death of a spouse

Unfortunately, the death of a spouse can mean a loss of income, support, and much more.

“Most couples share financial responsibilities in some way,” says Liedel. “If your spouse contributes half of your rent/mortgage, your car payment/insurance, your utilities, childcare, etc., [then] he or she dies, you will lose that support.”

“[You’ll] either have to pay double your previous expenses or change your lifestyle dramatically,” Liedel adds.

Aside from the immediate financial implications of the death of a spouse, there’s also the toll it takes on the spouse that is left behind.

Grief is a big part of losing a spouse, which can have a ripple effect on other areas of your life. After all, the death of a spouse is the number one stressor in the Holmes-Rahe stress scale.

“I’d compare the grief of losing Frank to a temporary mental illness,” says Liedel. “I was unable to work for many months after his death. I flaked on some work I had previously lined up because I couldn’t focus on it. This is common among people I’ve spoken to.”

“Losing a spouse probably means at least a 3-month period of not working at all,” Liedel explains.

If you have children, the burden can be even worse. Going from a two-parent household to a one-person household is tough — and costly.

“If you have kids, the difference between having to pay for every minute of time you don’t spend with your kid(s) versus sharing childcare duties with a spouse is enormous,” says Liedel.

All in all, the death of a spouse is more than just an emotional loss. It’s a financial one, too. While there are some things you simply cannot prepare for, there are some steps you can take to lessen the financial burden of losing a spouse.

How to prepare (financially) for the death of a spouse

When you’re in love and happy in your relationship, talking about death can seem rather morbid.

However, it’s imperative to talk about what might happen after the death of a spouse. Consider the following:

  • How would it impact your financial life?
  • What are your final wishes?
  • How would assets be divided up?
  • What are important passwords to financial accounts that you should know?
  • Where is important paperwork held?
  • What medical care would you like to receive, if you were suddenly incapacitated?

You should talk about all of these matters so that if something were to happen suddenly, you know how to proceed. And you aren’t left with any other surprises.

On top of discussing these matters, you’ll want to create a will and get all of this information in writing. You should start by creating at least two different types of wills.

  1. A simple will, which illustrates how you would like your assets to divided up and names who will be the executor of your estate.
  2. A living will, which sets up instructions for medical treatment in the event you become mentally or physically incapacitated.

Additionally, you may want to get a life insurance policy. Especially if you have kids, are the primary income earner, or have debt.

A life insurance policy provides death benefits for spouses in the form of financial assistance to make up for the loss of income after a loved one passes away.

“Life insurance makes all the financial stuff easier,” notes Liedel. “Money doesn’t bring back your dead spouse, but it will make a lot of things easier and help you rebuild your life in a healthy, non-desperate way.”

Dealing with the death of a spouse could mean losing half of your income, taking on debt by yourself, and having to deal with burial costs. Funeral arrangements alone could cost between $7,000 to $10,000.

And if you’re unable to work for a few months, the financial support with life insurance could keep you afloat.

There are death benefits for spouses available through the Social Security Administration as well. For instance, there is a lump sum payment of $255 a surviving spouse or child may receive if they meet certain requirements.

There’s also a survivor benefit amount you could receive. The actual amount of money does depend on some factors, including the earnings of the person who died and how much they paid into Social Security.

While Social Security death benefits for spouses can help, they likely won’t cover all of your expenses.

That’s why it’s best to calculate how much assistance you might need should your spouse pass away. Then, purchase a life insurance policy that would cover your expenses as well as any final arrangements.

Final thoughts

The death of a spouse is one of the most painful and stressful experiences one can go through. Yet, dealing with the financial implications of losing your loved ones can make matters even worse.

We all want to think we’re young and invincible and that love will prevail. However, sometimes life has other plans.

In this case, being financially prepared can make a world of difference, allowing you to grieve and process. Without the additional stress that comes with worrying about money.

Interested in a personal loan?

LendingTree allows you to compare rates from multiple lenders by filling out one easy form. Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.

RATES (APR)loan amount
5.99% – 20.01%1 $5,000 to $100,000
6.14% – 35.99% $1,000 to $50,000
6.98% – 35.89%* $1,000 to $50,000
99.00% – 199.00%2 $500 to $4,000
5.99% – 24.99%3 $5,000 to $35,000
5.99% – 29.99%4 $7,500 to $40,000
compare rates on Lendingtree now
NMLS #1136: Terms & Conditions Apply
1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Fixed rates from 5.99% APR to 20.01% APR (with AutoPay). Variable rates from 6.49% APR to 14.70% APR (with AutoPay). SoFi rate ranges are current as of November 15, 2019 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. See APR examples and terms. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 6.49% APR assumes current 1-month LIBOR rate of 1.81% plus 4.93% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.
  2. To check the rates and terms you qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull.
    See Consumer Licenses.
  3. Minimum Credit Score: Not all applicants who meet SoFi’s minimum credit score requirements are approved for a personal loan. In addition to meeting SoFi’s minimum eligibility criteria, applicants must also meet other credit and underwriting requirements to qualify.
  4. If you lose your job through no fault of your own, you may apply for Unemployment Protection. SoFi will suspend your monthly SoFi loan payments and provide job placement assistance during your forbearance period. Interest will continue to accrue and will be added to your principal balance at the end of each forbearance period, to the extent permitted by applicable law. Benefits are offered in three month increments, and capped at 12 months, in aggregate, over the life of the loan. To be eligible for this assistance you must provide proof that you have applied for and are eligible for unemployment compensation, and you must actively work with our Career Advisory Group to look for new employment. If the loan is co-signed the unemployment protection applies where both the borrower and cosigner lose their job and meet conditions.
  5. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)
2 Includes AutoPay discount. Important Disclosures for Opploans.

Opploans Disclosures

Direct Deposit required for payroll.

Opploans currently operates in these states: . *Approval may take longer if additional verification documents are requested. Not all loan requests are approved. Approval and loan terms vary based on credit determination and state law. Applications processed and approved before 7:30 p.m. ET Monday-Friday are typically funded the next business day.

  1. To qualify, a borrower must (i) be a U.S. citizen or permanent resident; (ii) reside in a state where OppLoans operates; (iii) have direct deposit; (iv) meet income requirements; (v) be 18 years of age (19 in Alabama); and, (vi) meet verification standards.
  2. NV Residents: The use of high-interest loans services should be used for short-term financial needs only and not as a long-term financial solution. Customers with credit difficulties should seek credit counseling before entering into any loan transaction.

  3. OppLoans performs no credit checks through the three major credit bureaus Experian, Equifax, or TransUnion. Applicants’ credit scores are provided by Clarity Services, Inc., a credit reporting agency.

  4. Based on customer service ratings on Google and Facebook. Testimonials reflect the individual’s opinion and may not be illustrative of all individual experiences with OppLoans. Check loan reviews.

  5.  

    Rates and terms vary by state.

3 Includes AutoPay discount. Important Disclosures for Payoff.

Payoff Disclosures

  1. All loans are subject to credit review and approval. Your actual rate depends upon credit score, loan amount, loan term, credit usage and history. Currently loans are not offered in: MA, MS, NE, NV, OH, and WV.
4 Important Disclosures for FreedomPlus.

FreedomPlus Disclosures

  1. All loans available through FreedomPlus.com are made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC, Equal Housing Lender. All loan and rate terms are subject to eligibility restrictions, application review, credit score, loan amount, loan term, lender approval, and credit usage and history. Eligibility for a loan is not guaranteed. Loans are not available to residents of all states – please call a FreedomPlus representative for further details. The following limitations, in addition to others, shall apply: FreedomPlus does not arrange loans in: (i) Arizona under $10,500; (ii) Massachusetts under $6,500, (iii) Ohio under $5,500, and (iv) Georgia under $3,500. Repayment periods range from 24 to 60 months. The range of APRs on loans made available through FreedomPlus is 5.99% to a maximum of 29.99%. APR. The APR calculation includes all applicable fees, including the loan origination fee. For Example, a four year $20,000 loan with an interest rate of 15.49% and corresponding APR of 18.34% would have an estimated monthly payment of $561.60 and a total cost payable of $7,948.13. To qualify for a 5.99% APR loan, a borrower will need excellent credit on a loan for an amount less than $12,000.00, and with a term equal to 24 months. Adding a co-borrower with sufficient income; using at least eighty-five percent (85%) of the loan proceeds to directly pay off qualifying existing debt; or showing proof of sufficient retirement savings, could help you also qualify for the lowest rate available.
* Important Disclosures for Upgrade Bank.

Upgrade Bank Disclosures

* Personal loans made through Upgrade feature APRs of 6.98%-35.89%. All personal loans have a 1.5% to 6% origination fee, which is deducted from the loan proceeds. Lowest rates require Autopay and paying off a portion of existing debt directly. For example, if you receive a $10,000 loan with a 36-month term and a 17.98% APR (which includes a 14.32% yearly interest rate and a 5% one-time origination fee), you would receive $9,500 in your account and would have a required monthly payment of $343.33. Over the life of the loan, your payments would total $12,359.97. The APR on your loan may be higher or lower and your loan offers may not have multiple term lengths available. Actual rate depends on credit score, credit usage history, loan term, and other factors. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. There is no fee or penalty for repaying a loan early. Personal loans issued by WebBank, Member FDIC.

** Accept your loan offer and your funds will be sent to your bank via ACH within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes this transaction. From the time of approval, funds should be available within four (4) business days.

Published in Big Money Decisions, Credit & Debt,

You're on your way...

You are being redirected to LendingTree.com where you’ll be able to fill out an online form. Based on your creditworthiness, you may be matched with up to five different personal loan lenders in our partner network.