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The Risk of Not Knowing

Updated: Oct 6, 2022

By Barbara Boone McGinnis, CELA

In one of the past episodes of Takacs McGinnis Elder Care Law Hour, we talked about retirement and financial planning for women. This is such an important topic.

The demographics tell the story. Women have a longer life expectancy than men, with many outliving their husbands. Since women often shoulder the responsibility for tending to children, caring for elderly parents, and managing family responsibilities, they spend more time out of the paid workforce and often work in part-time, less demanding, or lower-paid positions. Women are twice as likely to live at or below the poverty level during their retirement years.

One stereotype—that women are less confident about making financial investments, often deferring to their husbands—is often true, especially for older couples. In many cases, the women choose not to be involved in the finances.  Their husbands have always managed the finances.

That’s not a bad thing—but it can create problems.

I see sad situations every day that that could have been less traumatic with proper planning. One involved a woman in her 60s whose husband died unexpectedly. His wife had no clue how much money they had or where the money was located. She didn’t think she needed to know because he always “took care of her.”

Another husband, who handled all the finances and owned a home-based business, was incapacitated by a stroke. His 55-year-old wife had always assumed that she had access to his bank account. She didn’t. The account was in her husband’s name and it took months of wrangling with the bank to access those funds. She then spent countless hours sifting through all the transactions to identify the sources of the deposits and the reasons for the withdrawals.

This isn’t just an old woman’s problem. I remember a woman in her 30s who came to me after her husband had been killed in a motorcycle accident. She didn’t know the password to the family computer where all the couple’s financial passwords were stored. It was a nightmare for her.

Not knowing can be especially risky when it comes to retirement income. Many older women whose husband are drawing a pension have no idea how much the pension would pay them if their husbands died. They often assume that the pension payment will continue uninterrupted and are shocked to learn that the husband opted out of the surviving spouse benefits, choosing instead to receive a higher monthly pension payment during his life time. When that happens, the wife gets nothing.

These stories drive home an important point. Women of all ages must get involved in their finances and resist the temptation to delegate these important tasks to their husbands. Make a list of assets and keep track of account balances. Create a list of passwords and keep it updated. Sit down with your spouse (if you have one) on a regular basis to review your financial situation. Assemble a team of advisors to guide you. Take these actions as if your life depended up on it. Because it does.



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