Financial Planning After Loss: A Widow’s Financial Roadmap Series

Dec 12

Part 2: Understanding Your New Financial Picture

In the early weeks after loss, everything feels uncertain. You’ve gathered documents, contacted institutions, and taken care of the most urgent financial steps. But now comes the next chapter: truly understanding what your financial life looks like today.

This stage is about clarity—knowing what’s coming in, what’s going out, and how that fits into your future. You don’t need every answer right now, but the more you understand your new financial picture, the easier it becomes to make decisions with confidence.

Identify All Income Sources

Start by listing every source of income you’ll have moving forward. Even if you’re not sure what continues and what stops, write it all down. Seeing it in one place helps you feel grounded.

Common examples include:

Social Security survivor benefits: You may be eligible to collect your spouse’s benefit or your own—whichever is higher. It’s worth confirming your options with Social Security directly.
Employer pensions or survivor annuities: Ask your spouse’s former employer or HR department about survivor benefits or continuing payments.
Life insurance proceeds: Once paid out, these aren’t taxable but can affect how other income is taxed if the funds are invested.
Investment income: Interest, dividends, or capital gains from taxable investment accounts.
Employment income: If you’re still working, make note of your salary, benefits, and 401(k) contributions.
Rental or business income: Include any rental properties or business distributions that will continue.

💡 Tip: Create a simple table with the income source, amount, frequency, and whether it’s taxable. This makes future tax planning much easier.

Understand Your Monthly Expenses

Next, outline your expenses so you can see how much it costs to maintain your lifestyle. This isn’t about cutting back—it’s about clarity and control.

Start with fixed expenses like:

Mortgage or rent
Property taxes and insurance
Utilities and internet
Health insurance premiums and out-of-pocket medical costs
Auto or transportation costs
Debt payments or credit cards

Then add variable or discretionary costs:

Groceries and household supplies
Travel or entertainment
Charitable giving or gifts
Subscriptions and memberships

Once you have everything listed, total your fixed and variable expenses separately. This helps you see where you have flexibility and where you don’t.

🕊️ For many widows, simply understanding these numbers provides relief—it’s the difference between wondering and knowing.

Be Mindful About How You Create Income

If you’re no longer working—or your household income has changed—this is the time to think carefully about how you’ll create cash flow going forward.

Your income might now come from a mix of sources: 401(k)/IRA distributions, social Security, investment accounts, savings, or insurance proceeds. Each source can be taxed differently, so how you combine them matters.

For example:

Withdrawals from traditional IRAs or 401(k)s are taxed as ordinary income.
Dividends and capital gains from brokerage accounts may be taxed at lower rates—but can still push you into a higher bracket if you’re not careful.
Roth accounts and life insurance proceeds can often be accessed tax-free, depending on your situation.

Being thoughtful about which accounts you draw from and when can make a real difference in how much of your income you get to keep. A fiduciary advisor or CPA can help you create a withdrawal plan that balances your cash flow needs today with your long-term tax strategy.

💡 Even small adjustments—like changing which account your monthly withdrawals come from—can help extend your savings and reduce unnecessary taxes over time.

Review Accounts and Cash Flow

Now that you understand income and expenses, look at how your accounts are structured and how money flows between them.

Questions to consider:

Are joint accounts now solely in your name?
Do you have enough cash reserves for 6–12 months of living expenses?
Are automatic payments and deposits still routing correctly?
Are any accounts earning little to no interest that could be consolidated?

If you’re unsure where to start, gather your most recent bank, investment, and credit card statements and create a simple “household flow chart”—showing where income enters, where bills are paid, and what’s left over each month.

💡 Many widows discover small leaks—like duplicate subscriptions or automatic payments from an old account—that can easily be fixed once everything is mapped out.

Begin Re-Aligning for Stability

Once you have a clear view of income and spending, you can start re-aligning for stability:

Set up a single main checking account for income and bill payments.
Build or maintain an emergency fund in a high-yield savings account.
Pause any large investment or property decisions until you’ve met with your advisor.
Create a short-term cash flow plan for the next 6–12 months.

This isn’t about rebuilding your future just yet—it’s about creating a foundation that lets you make long-term decisions from a place of calm and confidence.

When to Bring in Professional Help

This is a good time to begin working with a fiduciary financial advisor or planner who specializes in transitions. An advisor can:

Organize and analyze all your income sources and expenses.
Review investment allocations and identify unnecessary risks.
Coordinate with your CPA to plan for taxes.
Help you rebuild your long-term plan at your pace, not the market’s.

At TARA Wealth, we walk with our clients through every phase of this process—from making sense of the paperwork to designing a plan for what comes next. Our goal is to bring calm, structure, and confidence back to your financial life.

Understanding your new financial picture isn’t about perfection—it’s about awareness. Each number you clarify, each account you organize, and each question you answer brings you one step closer to peace of mind.

Amber Schiffert