AKAMAI MONEY

By Deborah Adamson

Q. My husband died about a year ago, and we didn't prepare for him going first. I left everything in his hands, almost, and when he went, I had to take care of (financial and legal matters). I couldn't cope with it, so I left it to others. I don't know which way to go. — Violet G., 90, Aliamanu.

A. You're not alone. Many people are in your situation — especially widows, since women tend to outlive men. According to the 2000 Census, 45 percent of women 65 years and older were widowed, compared with 14 percent of men.

After letting their husbands handle most money matters in life, many widows suddenly find themselves overwhelmed by what they need to understand and do after the death of their husbands.

"It's a big shock. Not knowing about the finances can be very difficult for the widow," said Alexandra Armstrong, a Washington, D.C.-based certified financial planner and co-author of "On Your Own: A Widow's Passage to Emotional and Financial Well-Being."

The stereotype of a widow is a "blue-haired" senior citizen, she said. But they can be young mothers with children who never gave a thought to their financial affairs until their husbands die. So, no matter what age you are, it's always a good idea to start preparing as soon as possible.

"If something happens, guess who has to sort through all this? Wouldn't you rather have some idea of what's happening?" said Martin Arinaga, a certified financial planner with Chinen & Arinaga Financial Group in Mililani. "It's hard to go from not knowing anything to making $100,000 decisions."

If you're not prepared, you could end up falling victim to bad financial advice.

"They fall prey to people who say they have a 'magic bullet' for their situation," said Lesley Brey, a fee-only certified financial planner in Niu Valley. "They'll say, 'Write me a check and I'll take care of it.' Widows are very susceptible to that because they so want it to be better."

First, the don'ts: Don't do anything irreversible, she said. You're in a vulnerable frame of mind and what might sound good at first might not be the best thing to do. For example, one tendency after getting a windfall is to pay off the mortgage. But you might be tying up money you'll need later.

Don't rush into big decisions, such as relocating, changing investments, making large purchases and others, she said. Instead, park your money momentarily in a money market account until you get your bearings.

"There are few decisions you need to make immediately," Arinaga said. What's immediate: Paying bills, filing estate taxes, updating beneficiaries.

Don't splurge without thinking twice. A widow who is not used to dealing with money gets $200,000 at her husband's death and decides to pay for a cruise for the whole family. It's an emotional reaction, Armstrong said. But can she truly afford it? That $200,000 might have to last her whole life.

Don't pay bills that don't look familiar. Some unscrupulous people send fake bills for you to pay; you write a check thinking it was your husband's bill.

Don't trust people who call you out of the blue with something to sell. There are con artists who read obituaries to find victims, Armstrong said.

Don't fall for special deals from legitimate companies that try to manipulate the situation to make a bigger buck.

Some funeral homes say, " 'If you really want it to be special, we have this package,' when you'll be okay with a simple plan," Brey said.

The state also receives numerous complaints from bereaved spouses — nearly all widows — about their securities investments, said Patty Moy, senior enforcement attorney at the Securities Branch, Business Registration Division, Department of Commerce and Consumer Affairs. They may complain about unauthorized transactions by their broker or lack of clarity from another securities professional.

To make a complaint, call 586-2740. For the investment education program, call 587-7400.

Now here are the dos: Do take inventory and find out where you stand financially. Ideally, your husband should have organized the family's affairs neatly in a drawer somewhere. If not, ask the family accountant, attorney or financial planner to help you piece together the family finances.

If you don't have professionals to help you, ask friends or family for references. The goal is to work out a financial plan for you to live on. As such, make a list of your assets and debts to know what you can afford.

Do order at least 10 copies of the death certificate, Brey said. When you're trying to switch account information, claim life insurance and make other changes, you will be asked to provide proof of death.

Do order valuations or appraisals of your assets, which you'll need for filing estate tax returns within nine months of your spouse's death.

Do file a disclaimer by you or your co-beneficiaries — essentially giving up claims to an asset — if it would avoid taxes or one doesn't need the money. The disclaimer has to be filed within nine months after the date of death.

Do start collecting basic information for yourself, the executor of the will or anyone with the power of attorney, Brey said.

Include you and your husband's Social Security numbers; beneficiaries' names, addresses, Social Security numbers and birthdates; military ID number, if applicable; account numbers and financial institution addresses; location of wills or trusts; life insurance policies; annuities; credit card numbers; contact information for accountant, attorney, insurance agent, financial planner, company benefits administrator; and relatives and friends who serve as advisers.

Documents to collect include wills, trusts, powers of attorney, birth and marriage certificates, divorce decree, child support or alimony papers, adoption agreement, passports, citizenship papers, past tax returns, property deeds, auto or boat titles, insurance policies, and others.

Update documents as needed, such as to change the beneficiaries, Arinaga said.

Do contact Social Security Administration for survivor benefits at (800) 772-1213, Brey said.

Got a consumer or personal finance question? Contact Deborah Adamson at 525-8088 or dadamson@honoluluadvertiser.com