Life took a 360-degree turn after the death of my spouse three years ago. Suddenly, I was all alone with no one to share my innermost feelings and thoughts. The only thing left was his bittersweet memories and financial affairs that I had to deal with right away.
What happened to debts after my spouse’s death
What happens to debt after a spouse’s death? It depends on your situation.
In my case, I had to pay off all the credit card debts after my husband passed away. I was the joint account holder in all his credit cards. So, the onus was on me to pay off the debts.
Thankfully, we lived in a rental apartment. We were planning to buy our first home, but that did not happen ultimately.
How did I take charge of the household finances?
On my best friend’s advice, I consulted an attorney to take charge of everything. Household finance was a completely new book for me. I had no idea about it.
I paid the utility bills and rents with the money that was there in the bank account. But I had to tackle credit card debt worth $60,000. I did not have any idea about how to deal with it.
What did I discover? Some brutal financial revelations
Honestly speaking, I had no idea about the debts we had. My husband used to take care of all the credit cards, utility bills, mortgages, insurance premiums, etc.
The first week passed at lightning speed. I was so overwhelmed with emotions that I could not think about anything else.
However, the first wake-up call came when a debt collector called regarding a credit card debt. The debt collector informed me that my husband owed $60,000 on three credit cards.
I was shocked. It was a revelation to me. My husband had never told me about the credit card debt. When I informed the debt collector that my spouse had left this world, he just asked me to pay off the debt without any emotion in his voice.
The debt collector informed me that my name was there on the three credit cards. So, I was responsible for those debts.
How did I learn to pay off all the debts?
Without the guidance from the attorney, I would not have been able to do anything.
The attorney did the estate settlement process. He obtained all the credit card statements, death certificates, social security certificates, etc. He asked me to find the insurance policies as soon as I could.
Let me tell you one thing. It is not as easy as it sounds. The attorney had to submit nearly 15 to 20 copies of death certificates at various places to change several financial accounts’ names.
The attorney contacted my husband’s employer to get the details of his retirement saving plans.
It took almost a month for me to find the insurance policy papers. I did not have the contact numbers of the insurance agent.
The attorney contacted the insurance company after going through the insurance policies. My husband had a life insurance policy. I did not have any other idea about it. I was the beneficiary of the policy. The attorney completed all the formalities with the insurance company and helped me to get $30,000.
It helped to salvage my distressful financial situation to some extent. But that was not enough. I needed that $30,000 to cover my family expenses for a few months. I was not working back then. I was not in a mental state to start working right then. Plus, there were too many official formalities. I had to complete the probate process again.
The debt collector was not ready to wait anymore. She wanted $60,000. The attorney negotiated with the debt collector and brought down the payoff amount to $30,000.
The attorney asked me to settle the credit card debt with the insurance proceeds to avoid legal hassles in the future. I did not want to give that $30,000 to the debt collector. But I did not have any other option. If I didn’t pay that amount, the settlement agreement would become null and void. I would have to pay $60000 later. It was better if I settled credit card debt then and there. And I did exactly that.
A few mistakes I made
I made a lot of mistakes. The first mistake was that I never asked my sweet husband about our financial affairs. My husband always wanted to inform me of all the details. But I never bothered to know about them.
I had no idea about the username and passwords of all the online accounts. That created a lot of problems initially. Thankfully the attorney coordinated with the banks and retrieved all the account details. But it took time.
The online accounts gave me an idea about the recurring payments that my husband used to make.
Like I said before, I had no idea about our financial situation. I did not know where my husband kept all the financial records. So, it was a challenge for me to get all the financial documents like birth certificates, insurance policies, marriage certificates, etc.
Those documents were required to transfer assets and close certain accounts.
My husband didn’t leave any will. We never thought about it. However, now I feel that it is better to create a will beforehand. If there were a will, it would have been easier to untangle the complicated financial problems.
I lost a lot of time due to that.
Forever indebted for the proper guidance
I must confess that if the attorney were not there, I would not have been able to do anything. The attorney gave me an idea about proceeding with my husband’s retirement savings accounts and investment accounts. He also helped to re-title jointly owned assets.
Later, the attorney recommended a financial advisor to plan for my financial future. The financial advisor helped me to navigate the complicated tax filing status.
Life goes on
Death is an unfortunate fact of life, which nobody can escape. My life came to a standstill for a few days after I lost my spouse. But after a few days, I had to recharge the batteries of life and move on with the deep emotional wounds and scars in my heart.
Today, I am working as a freelancer and content developer to run my family. I have paid off my debts. I am still learning how to manage finances like a pro. I have a long way to go. Hopefully, after a few years, I will have a better grip on my financial life.
A few words of wisdom
Have you ever wondered what happens to a joint credit card when a spouse dies? What happens to a spouse’s debt when he or she dies? These are difficult questions. Most people do not want to ask these questions or discuss. However, in my opinion, it is better to know the answers and take preventive measures than suffering later like me.