Financial Assistance for Widows

The emotional toll of losing a spouse is incalculable. Unfortunately, bereavement is not the only trouble that death brings. It may not even be the most lasting.

The surviving spouse often must deal with significant financial as well as personal loss. While this can impact both sexes, women tend to outlive men, and men tend to out-earn women, so the economic impact falls disproportionately on widows.

Fortunately, financial assistance for widows is out there. Little to none of it lasts forever, but it can be a lifeline for those who suddenly find themselves in need. It’s about more than finding sources of money.

Learning to manage your money, obtaining professional help if you start sinking in debt and knowing how the financial decisions you make affect Social Security are part of the equation.

» Learn More: Inheriting Debt

What Financial Help Is Available for Widows?

Before reaching out for assistance, widows need to know what they have, not only from their deceased spouse’s personal life insurance policies and savings accounts, but through his former employer. Find out what he had in retirement accounts and if he had a life insurance policy through the company.

Financial help for single parents can be found through several government agencies, nonprofit organizations, churches and community groups in the form of grants for low-income widows and professional financial guidance that includes debt management advice.

Of course, the most obvious place to seek help is from those closest to you: your family. A single child can give a widowed mother up to $17,000 with no tax ramifications either way. If the child is married, the limit jumps to $34,000.

Family members could provide a loan at no, or low interest. Naturally, any such loan should have repayment terms written out. That helps avoid both hurt feelings and more complicated problems when the widow dies and her will goes to probate.

Government Help for Widows

There are some government programs available to assist widows with their finances, but don’t count on getting much money from them. The best advice is to go online to Benefits.gov where you will find more than 1,000 state and federal agencies that offer help. Here are a few of the prominent ones worth looking into.

Social Security Widow Benefits

Social Security is an important resource available. You can apply for Social Security benefits online, make an appointment with the local Social Security office or simply walk-in and see if an agent is available. 

Depending on what benefits you are applying for, you will need to present certain documents. Here is a list of benefits and what you’ll need to qualify for them:

• Widows/Widowers or Surviving Divorced Spouse’s Benefits
• Child’s Benefits
• Mother’s or Father’s Benefits (Child must be under age 16 or disabled in your care)
• Lump-Sum Death Payment
• Parent’s Benefits (You must be dependent on your child at the time of his or her death)

A one-time payment of $255 can be paid to the surviving spouse if he or she was living with the deceased; or, if living apart, was receiving certain Social Security benefits on the deceased’s record.

Monthly Social Security benefits may be available to a widow or widower age 60 or older (50 or older if disabled), a surviving divorced spouse in some circumstances and a widow/widower of any age who is caring for the deceased’s child who is under age 16 or disabled and already receiving benefits.

If the deceased worked long enough under Social Security, the widow/widower can receive full benefits at the full retirement age or reduced benefits as young as 60. The amount of the benefit depends on the earnings of the deceased. The more they paid into Social Security, the greater the benefits.

Financial Assistance for Widows of Veterans

When military personnel die as a result of their service, their spouses are entitled to a death gratuity, which currently is $100,000. It is free from federal and state income taxes for any service member who dies while on active duty or while performing authorized travel to or from active duty.

Dependency and Indemnity Compensation is a tax-free benefit paid to eligible survivors of military service members who died in the line of duty or eligible survivors or veterans whose death resulted from a service-related injury or disease.

For details and other benefits, visit Spousal Survivor Benefits.

Other Government Programs, Grants and Nonprofits for Widows

Let’s start with the bad news: There are no government grants specifically for people who lose a spouse. There are, however, grants to address specific needs, including needs that the widowed often encounter. Again, the best to start is Benefits.gov, which provides links to government benefits in every state.

Housing assistance is available through the U.S. Department of Housing and Urban Development. In addition to public housing that provides affordable apartments for low-income tenants, HUD provides what’s known as Section 8 Housing Choice Voucher Program that can pay for all or part of rent, and also helps apartment owners offer reduced rents to low-income tenants.

Widows looking to improve their long-term finances through higher education may be able to get Pell grants of up to $6,895 per year that are available through the Department of Education’s Federal Student Aid office.

The United Way, the largest privately funded nonprofit in the world, is not set up to provide individual assistance, but works with many community partners who do. Call 211 to reach a referral specialist who will know what services are available in your area.

Dress for Success is another nonprofit that will help women achieve economic independence by providing support, professional attire and development tools to help women thrive in work and life.

» Learn More: What to Do When You Can’t Afford Rent

Charities and Church Assistance for Widows

Most of the nonprofit organizations, churches and community groups that offer assistance to widows can be found online. They usually offer help on a one-time basis for things like food, housing, clothing, furniture and other basic needs. Here are some worth trying:

• The Liz Logelin Foundation provides short-term financial help to young families with dependent children during the first year after death to assist with rent or a house payment, utility bills, a child’s activity fees, lessons, school clothes, a special family outing or gifts for the children.
• Vincent de Paul Society is a part of many Catholic churches. SVDP deals specifically with people in a financial crisis. Their assistance usually is for needs such as rent, utilities, clothing, food and pharmacy needs.
• Wings for Widows provides financial coaching and education for new widows to help them achieve financial wellness after a spouse’s death. Their service is free.
• Modern Widows Club wants to empower widows to lean into life, build resilience and make a difference in society.
• Widow Connection provides skill training for widows for economic independence through books, DVD’s, journals, podcasts, and church resources and tools.
• Hope for Widows is a charitable giving organization developed by widowed women that strives to offset the financial challenges of and build a community among widowed women worldwide.
• Sisterhood of Widows is an online grief support site for widows, offering compassion and encouragement to help you stand on your own and say “Yes!” You can do it.
• American Widow Project has been helping military widows in their healing since 2007. For many military widows finding ways to provide hope and service in their own communities is a valuable part of the healing process.

What Happens to Debts?

Although many of the concerns widows must face involves lost income, there’s also the matter of debt the deceased spouse had. Is the surviving spouse expected to pay debts after a death?

A surviving spouse is not responsible for the deceased spouse’s debt unless you co-signed a loan or credit card agreement. The most obvious examples of that are loans for a house, a car or a credit card. As co-signer, you are liable for the debt.

If you aren’t on the loan agreement, you are not personally obligated to pay it off.

However, in community property states (Alaska, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin), a husband and wife are each equally responsible for paying each other’s debts as long as one of them acquired the debt during the marriage. Consult an attorney.

Credit Card Debt

Was your name on the credit card as a co-signer? Then, the debt is yours, no matter how often you actually used the card. If you don’t pay on the card, your credit score will take a big hit, and you can expect regular calls from a collection agency.

Can’t pay? Don’t delay: Talk to a nonprofit credit counseling agency for advice on a debt management plan, debt consolidation loan or debt settlement. Do it before a collection agency starts calling.

However, if your name is on the account simply as an authorized user, you are not responsible for the debts, but the estate is. If money is available when the estate is settled, it will go toward paying the balance of the credit card debt.

Again, the community property exception applies here. Check with an attorney.

Mortgage Debt

If your spouse dies and the mortgage has not been paid, the responsibility typically falls to you. Assuming you want to keep living there, you’ll need income or assets to stay current with payments.

If the deceased had a life insurance policy, you might use the proceeds to keep paying on the mortgage, or even retire the debt. Another option could be selling the house to satisfy the debt, though that means finding another place to live.

If you or anyone else in your family is unwilling or unable to make payments, the lender can foreclose on the loan and sell the home through auction.

» Learn more: Mortgage Payment Assistance and Relief Programs

Medical Bills

This depends a lot on where you live. In general, a spouse is not obligated to pay the medical debt of another spouse. However, you typically would have to pay if you live in a community property state, or if you signed a document stating that you would be responsible for payments on a medical bill when your spouse was admitted to the hospital.

Some states have what’s called “doctrine of necessities.” This makes a spouse liable for the “necessary” expenses incurred by the other spouse during marriage. Medical bills are almost always deemed “necessary.”

Even in states where those rules don’t apply, the creditor could still seek payment from the estate of the deceased.

Professional Financial Help for Widows

The melancholy irony of widowhood is that in your time of bereavement, it’s important that you don’t try to tackle the big issues all by yourself. That’s true even if you correctly consider yourself a capable, independent person. The issues are too important.

What issues? Pension options. Social Security spousal benefits. Life insurance. Paying the bills. Changes to your house title and other assets. Bringing your own will and estate plans up to date.

This is a time for trustworthy advisers, both for immediate decisions and ones for the long term. Expert advice from an attorney, financial advisor and accountant can help you get through the tough decisions to make your future smoother.

Consult an Attorney

Using an attorney through the probate process is a good idea, even if the issues appear simple, and a really good idea, if they do not. A probate attorney can manage the process, enabling you to make decisions about your future.

Attorneys also can modify your own will and other documents in keeping with your needs and your new situation. Additionally, your attorney will be able to make adjustments to estate planning documents such as financial powers of attorney, healthcare powers of attorney and living wills.

Depending on the complexity of the estate, the legal process can take a few weeks to several years to complete. You absolutely need someone to guide you through that.

Hire a CPA

Taxes can be complicated enough in a normal year. The death of a spouse adds more variables, which makes a CPA a good person to have in your corner.

Some of your benefits may be taxable. Some may not. When filing taxes, you’ll want someone who can get the most out of deductions and plan for what you’ll owe. Unless you’re a tax expert yourself, hiring a CPA is a good move. Do so within the first month after your spouse’s death to make sure you meet tax filing deadlines for the estate.

Hire a Financial Planner

It’s hard to know where you’re going unless you know where you are, and that’s especially true of finances. A financial planner can assess your situation and the impact of your spouse’s passing on your future.

A planner who studies your assets and obligations can put together a financial strategy or update any existing plans to help your life become what you want it to be in terms of retirement, education, travel, charitable giving, among a wide range of possibilities.

That way, you can secure your financial future and avoid any unnecessary risks or sacrifices to your current lifestyle.

Consult a Nonprofit Credit Counseling Agency

Perhaps you’ve been widowed for a while, and you’re having a hard time paying your bills, much less saving for the future. The balance on your credit cards keeps growing, and you can’t seem to get on top of it.

There are reputable, nonprofit counselors that can help. Their services are available by phone or online. Find one that is certified by the National Federation for Credit Counseling (NFCC)  by using your favorite search engine. The NFCC certified the counselors at each of its member agencies and has very strict guidelines those counselors and agencies must follow.

Your financial institution, local consumer protection agency, and friends and family also may be good sources of information and referrals. But take note: Nonprofit doesn’t necessarily mean free, and it’s best to check with online review sites, your state attorney general or local consumer protection agency to make sure they’re legitimate.

Reputable credit counseling agencies can give advice on managing money and debts, help develop a budget and offer free educational materials and workshops. Their counselors are certified and trained in consumer credit, money, debt management, and budgeting.

Obviously, losing a spouse is difficult. Finding people to help you navigate the issues you’ll face will go a long way of making things better.