There are three things to bear in mind when you plan for the loss of your partner.
Communicate
I'm sure you can imagine the mood-kill if you open a conversation with your partner with ‘Hey darling, let's open a bottle of wine and talk about what'll happen when one of us dies!' Nobody wants to talk about this stuff, but talk about it you must if you want to be as prepared as possible.
There's probably nothing more likely to engender a sense of unease, than not knowing about any given situation. And in this case it's definitely far better to have thought through and communicated in advance what the implications will be of one of you passing away.
A good financial planner can help with that, or a solicitor, or even an accountant, by laying out exactly what would happen, what income levels would be, what costs might reduce when there's only one of you, things like that. That's nothing that you couldn't do yourselves, but it might help to get some outside professional help.
Talking about this stuff is challenging enough when the family situation is simple, but if it's a second or subsequent relationship, perhaps with kids from previous relationships that one partner wants to look after, things can get very challenging indeed.
Again, a professional adviser can help to facilitate those discussions if you're finding it too difficult on your own. You're going to need to find a way to talk about this stuff that works for you, but anything is better than not dealing with it at all.
Annotate
While discussing your finances, be sure discuss the future. If one partner is more financially savvy and tends to take the lead, then it's incumbent on them, I believe, to make sure the less engaged partner is able to contribute to the discussion and understand what's going on. Part of this will be to write down what will happen when one partner dies. And do it as if they have already died. Sounds a bit morbid, but let me explain.
Let's take income as an example. Let's say you have a husband and wife, and she was a GP with an NHS pension, and he was self-employed and has a personal pension. He will need to know what her NHS pension will pay out to him when she dies. He'll also need to know what the household outgoings are likely to be with just one partner at home.
So take a stab at food costs for one. Running the house is likely to cost the same, but council tax will be lower for single-occupancy. Any costs that the wife incurs for herself, like club memberships, grooming costs etc, will fall off, so bear that in mind too. And of course the reverse is true – what happens if he goes first?
Having this written down, in advance, will be massively helpful for the one left behind and the people who are helping them. Of course, the document would need to be kept up to date, so set aside time perhaps once a year to do that – shouldn't take long.
Confide
And finally, if you're comfortable in doing so, don't be afraid to bring family members into the discussion. If you have named your kids as executors, then they will benefit from being a part of the discussions and having a copy of whatever is written down.
What we're aiming for is a WID file – a When I Die file – that is a quick-reference guide to everything that will need to be addressed when one partner dies. In summary, this is what should be in there:
- A copy of your will and details of where the original is held
- Contact details for your executors, plus any professional advisers such as financial advisers, accountants and solicitors
- A list of all pensions, investments, life insurances and bank or BS accounts including whose name each is in, the provider and policy or account number for each, plus contact phone numbers for each one. You might want to consider having passwords to accounts in here too, but be careful – make sure this document is held securely against prying eyes
- A list of standing orders and direct debits including when in the month they are paid and to whom
- A ‘cancel' list, including anything that should be cancelled (like club memberships etc) when that partner dies
- Funeral wishes (if these are not expressly part of your will)
Maybe you can think of more things that should go in there. But imagine how much easier life will be for the partner left behind if they have a file like this that they can access. Eventually, the dreaded event will come to pass, and you might be the partner left behind.
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