Home Radio Segments Guest Segments After The Shock: Your Financial Guide To Losing A Loved One

After The Shock: Your Financial Guide To Losing A Loved One

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Chanel Reynolds, Financial Guide To Losing A Loved One

With Chanel Reynolds, Author of What Matters Most

To learn how to manage all the financial and legal issues that follow the death of a spouse, Steve spoke with Chanel Reynolds, the author of What Matters Most. Here are the highlights from their conversation.

A Crisis Leads To Learning

What if you got the call we all fear? Your significant other has been in a serious accident and you don’t know if he or she is going to live. What if he doesn’t wake up? Can I keep the house? How much insurance do I have? What is probate? And what is the password to his phone? This is exactly the experience Chanel Reynolds had, the experience that led her to realize that she didn’t even remotely have her act together. Fortunately, moving forward by talking with others who had gone through similar circumstances, she learned a lot about how to handle the most important things in life following the death of her husband – things like wills, money, funerals, and insurance.

Things You Never Thought Of

Few of us have actually taken the time to really think through how we would handle a sudden crisis in our lives such as the death of a spouse. Just one of the many unexpected problems Chanel had when her husband suddenly died was not knowing the password to unlock her husband’s cell phone so she could notify all the necessary family members. Along with that came an avalanche of questions about legal, financial, and insurance-related matters—questions she didn’t have the answers to.

Funding A Funeral

One of the first potential problems people face after the death of a loved one is managing to pay for the funeral. The average funeral costs between $8,000 to $10,000. For many living paycheck to paycheck, with virtually no savings or emergency fund, that can be a huge problem. Some people mistakenly assume they can cover that expense with life insurance, but it’s often weeks or months before a life insurance payout arrives.

You Need Life Insurance

The death of a spouse can often put you in a deep financial hole, one that may take years to dig out of. Having adequate life insurance can help cushion that financial blow. People often resist buying life insurance—paying for something they hope they never need—but it can be critical to your and your family’s financial survival if your spouse dies. It’s also important to keep your insurance policies updated. For example, you may have had enough insurance at one time to pay off your mortgage, but you may have since bought a much more expensive home.

Have Your Paperwork Organized

One of the most important things people can do to be better prepared to deal with the aftermath of a spouse’s death is to have all the basic paperwork organized, up to date, and stored in a safe place. This includes items such as birth certificates, marriage certificates, social security cards, insurance cards, wills, and living wills. Doing some basic estate planning, having wills, living wills, and power of attorney documents prepared can be a big help in dealing with issues such as end-of-life care and probate. You don’t want to have to be spending hours or days ransacking your house looking for basic legal papers.

Reviewing and possibly updating the beneficiaries on all financial accounts is also critically important, especially concerning those that are not joint accounts.

A good financial advisor can help you organize things and keep them up to date.

Keeping Private Things Private

Let’s face it, there may be private things that after your death, you don’t particularly want your mom or your kids to find. A good way to deal with this issue is to have a “cleaner” appointed, someone you’ve informed what and where those things are, who is responsible for coming in, collecting, and discreetly disposing of them. They can gather all your adult items, even the Elvis jumpsuit you’d rather not have anyone know you ever wore.

To learn more about how to be well-prepared to deal with the death of your spouse, take a look at Chanel’s book, What Matters Most.

Disclosure: The opinions expressed are those of the interviewee and not necessarily of the radio show. Interviewee is not a representative of the radio show. Investing involves risk and investors should carefully consider their own investment objectives and never rely on any single chart, graph or marketing piece to make decisions. Content provided is intended for informational purposes only, is not a recommendation to buy or sell any securities, and should not be considered tax, legal, investment advice. Please contact your tax, legal, financial professional with questions about your specific needs and circumstances. The information contained herein was obtained from sources believed to be reliable, however their accuracy and completeness cannot be guaranteed. All data are driven from publicly available information and has not been independently verified by the radio show.

Read The Entire Transcript Here

Steve Pomeranz: What if you got the call we all fear? Your significant other has been in a serious accident and you don’t know if he or she is going to live. What if he doesn’t wake up? Can I keep the house? How much insurance do I have? What is probate, anyway? And what is the password to his phone?

This is exactly the experience my next guest has had as she realized she didn’t even remotely have her act together at all. Fortunately for us, she looked around the hospital at the time and realized from talking to others going through similar circumstances, that very few of us have thought this stuff through. So she wrote a book sharing what she learned. Chanel Reynolds joins me and the book she has written is What Matters Most: The Get Your S*** Together Guide to Wills, Money, Insurance and Life’s “What Ifs.” Welcome to the show, Chanel.

Chanel Reynolds: Thank you, thank you for having me.

Steve Pomeranz: So on July 17th, 2009, you got the call we all fear. What happened and what ensued?

Chanel Reynolds: Yeah, well, actually it was a lot of voicemails and missed calls that I got when I was over at a friend’s barbecue and went to grab my phone to take a picture, and then I noticed there were all these missed calls from numbers I didn’t recognize. And my first inclination was to not listen to them, but something felt off. And from that moment forward, all I knew was my husband had been in an accident. They’d been trying to find me. It was really bad, and they took him—and I didn’t know to where or what was going on.

So I was able to try to get my wits together for a second. Told my son that he was going to have a surprise birthday or a surprise sleepover at my friend’s house. And rushed to the hospital, calling around, actually, trying to figure out what hospital he was at. So that kicked off of the whole week of me going from, I hope he’s still alive to is he going to stay alive, to realizing that he was never going to wake up. And he would never be able to really be alive or fully engaged in the world.

Steve Pomeranz: How long did he stay alive?

Chanel Reynolds: Well, he officially died at the scene with a traumatic cardiac arrest or heart attack, I believe. And they had a group of really talented people bring him to a level one trauma hospital. Well, when he arrived, he had a pulse, which apparently shocked the paramedics, but he never woke up. So he was still technically alive or with us on the machines, on ventilators with 1000 tubes going in and out, but he never woke up or regained consciousness.

Steve Pomeranz: So you’re in this week of hell where, again, he’s breathing. He’s got a pulse, but he’s really kind of not alive as we know it. And you must have had, obviously, the shock and it takes time just to even get a little bit acclimated to that. But in your dark moments, you’re going, wait a minute, do we have wills? I think we have wills, but did we sign the wills? And if we didn’t sign them, is there enough there that people will know what his wishes were? What about the marriage, crazy things like what about our marriage certificate?

Chanel Reynolds: [LAUGH]

Steve Pomeranz: Did the state actually get it in the mail and notate it? Who looks at that stuff? You assume it. So take us through some of those [LAUGH] thoughts and other things that you learned and want to share with us.

Chanel Reynolds: Yeah, well, from those first minutes really, trying to get to the hospital and finding the right one. I called the people I had on my favorites list on my phone. But I didn’t have all of my late husband, Jose’s, family phone numbers with me. When I get to the hospital, they handed me his phone, and I didn’t have the four-digit password to open it up, to get in there, to call anyone. And so from these, really, very first moments, I realized that we just had not thought through what would happen if something happens. It took an extra couple of hours to find me and for me to get to the hospital. And the whole time I was thinking, what if I missed him? And then in the days that came after that, I was asked for insurance information, and if we had our affairs in order and medical decisions and long-term care, disability care, life insurance.

And so really quickly, I was trying to be present in the room and not let my eyeballs drip out through [LAUGH] my head onto the floor, just to understand what was happening. And at the same time, there was just this growing, huge list of things and I didn’t have all the answers to them. I knew some of them because we split responsibilities. And I had some of the information, but not a password to his phone. I didn’t know if he had checked the box for disability. So really quickly, in the midst of like the worst possible moment I can imagine for myself or anyone else, all of these questions kept bubbling up. And they were really all about legal and financial and insurance and even just the basic kind of wrangling of details, like account names and passwords. I spent dozens, if not hundreds of hours on the phone trying to get access to stuff or get my phone turned back on. And there’s just this gigantic organizational failure when it comes to what happens if something happens?

Steve Pomeranz: Well, you mentioned-

Chanel Reynolds: And stuff is so fragmented, yeah.

Steve Pomeranz: You mentioned that these calls you made, you would end up talking to the people in the sorry-for-you- loss departments.

Chanel Reynolds: Oh right. I not so lovingly came to call, when I would call whoever, trying to find where our family vacation photos were. Or getting my phone turned back on. Or our bank accounts and very quickly I’d say, hi, my name is Chanel and my husband just died and I’m trying to. And often, before I could even finish that sentence there was this very scripted, ma’am, let me say I’m sorry for your loss, let me transfer you to somebody who can help you. And I spent a lot of time figuring out what papers I had to send, to who to get more papers to send to somebody else. And it was an excruciating, really confusing process. And every single company or every single different kind of organization seemed like they had a different process. So it took months, if not years, to finally wade through all of the just documentation and paperwork.

Steve Pomeranz: Not only that, you have to now consider the funeral arrangements, which may have been discussed, probably not, cremation, regular burial. The cost of that, do you have life insurance to cover it, where’s the cash going to come from? So many people don’t even really have emergency funds, they’re a paycheck away from a financial disaster. And yet, there’s definitely some financial costs that go on kind of immediately that have to be paid.

Chanel Reynolds: There are, yeah.

Steve Pomeranz: Go ahead.

Chanel Reynolds: Yeah, there are, the average funeral costs about 8,000 to $10,000 in the US. And if people have a hard time coming up with $400 to cover an emergency, most folks don’t have that laying around. In addition, we had health insurance and it was pretty good. But I had to pay the $10,000 out-of-pocket maximum which is also something. That people really can’t cover. So we did have life insurance, the check doesn’t come for a while. And there is a number of weeks or a month or two in between where we didn’t have an emergency fund because we had been redlining our finances. We had got a kid who’s about to go into kindergarten, pre-school and all those costs are really high. So we were kind of just at the point where things were going to get better and we would have been fine if nothing went wrong. But that’s not what happened for us, and that’s not what happens for a lot of people.

Steve Pomeranz: So you were a 39-year-old single mom with a 5-year-old daughter and a 12-year-old step-daughter. You’re a widow now. You still can’t guess the password in his phone or his laptop. You never signed your wills so everything went to probate court. You have no paid time off, no steady income, and a mortgage you can’t afford on your own. What do you do?

Chanel Reynolds: Yeah, well, you feel really stupid for a while. That’s for sure. It was embarrassing. And I was a project manager. And so just the fact that I couldn’t find things or I hadn’t really thought things through, it felt really awful. One thing that helps just a little bit but was kind of even more terrifying is so many of my friends and family members would say to me, right away, oh, my god, we don’t have our stuff together either. We don’t have wills; we don’t have this kind of stuff. So in one of the worst spots I could possibly imagine being in, I also have to say that I had worked and I was college educated and I had some options. But the life that we had had was a two-income family and we went quickly to a non-income family.

Steve Pomeranz: Yeah.

Chanel Reynolds: And I didn’t lose the house right away. I prioritized using the life insurance money as a bridge, essentially, from our old life to the new one, to help mitigate as much additional loss as possible for the kids, so they could just chill out and go to school and try to be regular kids for a while. In addition to the loss of my husband and my children’s father and the future we’d planned, financially, I lost a lot as well. And it’s a hard road for a lot of people to try to dig themselves out of a hole that an accident or an illness or a diagnosis can cause. It took years, years and years.

Steve Pomeranz: Yeah, my guest is Chanel Reynolds. The book is What Matters Most: The Get Your “Stuff” Together Guide to Wills, it’s really not stuff, guys, there’s an asterisk in that word.

Chanel Reynolds: [LAUGH]

Steve Pomeranz: The Guide to Wills, Money, Insurance, and Life’s What-ifs. So, Chanel, you don’t sell any financial products, you don’t sell life insurance or disability insurance, you don’t sell trusts or put trusts together and neither do I. So let’s discuss what people need without kind of having to worry about the overselling of some kind of item. So starting now—which is the time to do it before something like this may happen—let’s start with life insurance. So first of all, why do you think it’s so hard for people to sign the papers to secure some life insurance when they’ll sign crazy papers for a mortgage. It’s a 27-page document, but they’re not willing to sign a two-page document to get some life insurance.

Chanel Reynolds: Yeah, well, I mean, we don’t like paying for a service we hope to never use, first of all. And that makes sense. But we also don’t like giving money, I think, to industries that we don’t really feel we can trust. So I think there’s certainly a trust issue with that.

Steve Pomeranz: Mm-hm.

Chanel Reynolds: And it feels really optional, and it is optional, not like health insurance or car insurance. But if people do the math, that was kind of how we thought of it. We’d bought life insurance when we bought our first house, and our son was born. And it was enough then to cover us for a few years and pay off the house that we had. We hadn’t updated our life insurance in five years and had moved to a much bigger house and our finances looked really different. And so because we didn’t update it, I had nowhere near the ten years of your salary-plus, whatever else you need equation. I had some, which was life-saving, but yeah, it’s not a really fun thing to buy. Going out to dinner is a lot nicer than the 30 or $50 a month you spend on life insurance, for sure.

Steve Pomeranz: [LAUGH] Exactly.

Chanel Reynolds: Yeah, but for people where if one person’s income in a couple or if your income were to go away, if that would cause everything else to fall apart too, having some life insurance is a good thing, I think.

Steve Pomeranz: Yeah, yeah.

Chanel Reynolds: I think, and my personal experience is it helps.

Steve Pomeranz: Yeah, if you think about it like your insurance on your house, I mean, you don’t buy insurance on your house and hope that your house burns down, but if it does-

Chanel Reynolds: [LAUGH] Right.

Steve Pomeranz: You’ve got the resources to rebuild. And it’s the same thing with life insurance, but especially that lost income, that’s a big deal. And especially, considering that I think most women and you mentioned this in your book, most women make less than their male counterparts. They spend more time caregiving, so even less money or less time is spent in the workforce. And because of this, they kind of end up with less money at the end, especially in a situation where they find themselves stranded because of an event like this. So life insurance can really fill that gap. Let’s move on from that. But there’s basic paperwork that you need. There’s your social security card, like the real one, the birth certificate, the real birth certificate. [LAUGH] The real stuff that you’ve got to have.

Chanel Reynolds: The real stuff, right.

Steve Pomeranz: Where is that stuff? You’ve got to ask yourself, if you’re listening to this, where is that stuff and could someone maybe you know where it is, but could someone else find it?

Chanel Reynolds: Exactly, there were just the basic insurance cards, Social Security numbers, marriage certificates, birth certificates. Because we had done our wills and we’d done some of the basic what they call estate planning which was a will and a living will, which is end-of-life planning and a power of attorney documents. People who can make decisions for you if it’s not necessarily an end-of-life situation. We had done them, which was great, but they were sitting in my inbox unsigned, which helped me not at all.

Steve Pomeranz: Yes.

Chanel Reynolds: We live in a community property state and because we didn’t have any international citizenship or any complicated child guardianship issues going through probate for me was relatively easy. But it still cost a few thousand dollars that I rather not have paid to have an attorney help me through it because I didn’t even know what probate was. And then just the passwords to account information.

Steve Pomeranz: You never think about that.

Chanel Reynolds: And knowing, yeah, for your credit cards, for your bank accounts, for your 401Ks. Is your name on it? Because if your name’s on it, you have access to it. It also means you’re responsible for it. And then just simple stuff like updating your beneficiaries or naming a beneficiary on all of your financial accounts.

Steve Pomeranz: Yeah.

Chanel Reynolds: Because even if you have one listed in your will, which half of Americans have a will and the other half don’t. Whoever is listed as the beneficiary at that financial establishment, that trumps a will. And often people will sign somebody up like their mother or sisters or spouse, and not update it for ten years. And ten years later you might have, you might be married to somebody else and not want your ex to get your retirement fund. So just little, little things, the little things are the big things is what I found out.

Steve Pomeranz: Keep up to date, yeah, a good financial advisor will be on top of those things with you and for you to make sure you’ve dotted those I’s. There was one thing here, we’re out of time, I mean, I think we could do another session on this and we probably will. But what about the very private things, [COUGH] the private stuff that you don’t really want your children seeing and remembering you by? If you know what I mean.

Chanel Reynolds: [LAUGH] Right.

Steve Pomeranz: So, [LAUGH].

Chanel Reynolds: Yes.

Steve Pomeranz: What do you recommend there?

Chanel Reynolds: I had a friend actually make this recommendation a few years ago when I was talking about all of the things that can get lost and never found. And he said, well, actually we have a friend who’s the cleaner. And I said, well, I don’t know what the cleaner is. I think it’s from La Femme Nikita, the movie, where you have somebody come in and take care of stuff. But people have private, adult, consensual things in their house that they may not want their kids or their mom to find. And so having somebody come and make sure that the things that are found get found, and probably make sure some of the things you don’t want everyone to know what your specific kink was, or that you like to dress up, or do whatever. Or you don’t need people to know that.

Steve Pomeranz: No, no.

Chanel Reynolds: Private things stay private. I think whatever people want to do is great. And you can ask somebody and make sure they have a house key or access to where it is to come get-

Steve Pomeranz: Come get your-

Chanel Reynolds: Your adult items or your Elvis jumpsuit collection because it needs to go to someplace special.

Steve Pomeranz: That Elvis thing has to stay private too.

My guest is Chanel Reynolds. The website is Chanelreynolds.com where you can find out more of this stuff. And all of the stuff that she talks about in the book. And the book is a wonderful book. I’ve really enjoyed it, it’s called What Matters Most, The Get Your Stuff Together Guide to Wills, Money, Insurance, and Life’s “What-ifs.” Chanel, thank you so much for joining me.

Chanel Reynolds: Thank you.

Steve Pomeranz: To hear this and any interview that we do, if you have any question about what we’ve just discussed we’d love to get your questions. Visit our website stevepomeranz.com. To join the conversation. While you’re there, sign up for our weekly update where we will tell you about all of our live events and important topics that we’ve covered this week straight to your inbox. That’s stevepomeranz.com.