There is a financial responsibility spectrum.
In some households, managing the finances is fairly equal. In fact, it is more and more common for spouses to keep their finances separate so the responsibility is 100% for each.
Other households have one spouse that handles the finances much more than the other, even to the point of nearly 100%.
This article is for those “financial spouses”.
You’ve gotten your family to this point financially. Think about all the responsibility you’ve taken on over the years. You handled the budget, the investments, the mortgage, the other debt, the insurance decisions, the taxes, the company benefits, the retirement accounts, the retirement projections, and much more.
You bought life insurance and did an estate plan because you took the responsibility of taking care of your family even after you’re gone. You did it all so your spouse didn’t have to worry about any of it.
If you’re reading this, you probably did a good job. You also probably didn’t ever hire a financial advisor because you didn’t need to.
But will your spouse need an advisor to help them after you’re gone? If you’ve been the one primarily handling the household finances, you already know the answer is yes. Especially since retirement planning for single people has it’s own complexity.
Will they know what kind of advisor to use? Will they know about Fee-Only? Will they know to find an advisor that works in their best interest at all times or be taken advantage of by a sales-person masquerading as an advisor?
If you are the kind of person who took care of all the previously mentioned responsibilities, then you will want your spouse to have a clear path of who to seek help from when you are gone.
I’ve offered a few suggestions below on how you can start the process.
The first is the simplest. Simply leave a note and contact info of a trusted advisor with your Will and other important documents. This is what I’ve done. My wife knows exactly who to contact for financial help if I’m hit by space debris. This option requires you to know who that advisor is though.
The second is to pursue a limited engagement. Many fee-only firms will work with you on a limited basis, either hourly or on a project basis. This can be a great way to work with an advisor to make sure they are a good fit. It also gives your spouse a chance to get comfortable with the advisor. It has the added benefit of giving you a professional second opinion.
If investments are your concern, then try to find an advisor to just manage a portion of your money. This may be a little harder to do because a lot of fee-only advisors have high minimum asset sizes or only want to work with you if they manage everything.
Don’t let a lifetime of responsibility go to waste by not planning for this transition. Jason Zweig with the Wall Street Journal has 19 questions you should ask an advisor, along with his suggested answers. You can read my answers as a starting point.