When Something Happens to the Financial Spouse

Why This Conversation Matters

In almost every partnership, one person assumes the role of the “financial spouse.” Whether you actively manage your family’s finances or defer to your partner in that area, it’s important to prepare for the unexpected. If something were to happen to the financial spouse, would the non-financial spouse have the tools, knowledge, and confidence to navigate the family’s financial future?

This guide is designed to you take five critical steps to safeguard your family’s finances and stability if something happens to the financial spouse.

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For a more detailed walkthrough you can watch a recording of our webinar "Managing Concentrated Stock"

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Also be sure to download your customized Planning Packet for more resources as you construct your plans!

Step 1: Create a Live Balance Sheet

A live balance sheet provides a real-time snapshot of your financial situation. By comparing your assets to your liabilities you arrive at a number you'll recognize as "Net Worth". Any balance sheet is meant to be constructed as of a specific date a time. Providing your spouse access to a "live" version of this document means your partner will have up-to-date info right when they need it.

Why It Matters

• Confidence in Decision-Making: If the financial spouse is no longer available, a live balance sheet empowers the non-financial spouse to make informed financial decisions.
• Ease of Access: It eliminates the need to search for account details, assets, or liabilities in a time of crisis.

How to Get Started

1. List Your Assets and Liabilities: Include details such as account numbers, fair market values, and interest rates.
2. Update Regularly: Use software tools or a manual process, like a monthly update, to keep the information current.
3. Date Your Balance Sheet: Always include the date for accuracy.

Pro Tip: Share your balance sheet with your spouse monthly. If something changes—such as opening a new account—be sure to update it promptly to avoid confusion.

Step 2: Build Your Financial Team

Think of yourself as the “personal chief wealth officer” of your family. You're the executive in charge of building and maintaining wealth. As the financial spouse, consider the roles you are filling in your family's "org chart" and consider if your spouse could fill those same roles if something were to happen to you. For any gaps you identify, create systems and a team to backstop your spouse. Assembling a team of trusted professionals ensures that your financial plan remains robust, even in your absence.

Who Should Be on Your Team?

• Accounting and Tax Professionals: For tax planning and filing.
• Estate and Legal Advisors: To handle wills, trusts, and other legal documents.
• Investment Advisors: To oversee portfolio management.
• Insurance Agents: For property, casualty, and life insurance needs.

What If You Currently DIY?

If you currently handle these tasks yourself, ensure your spouse knows how to take over—or backstop your efforts by hiring professionals.

• Hire a flat-fee financial planner for a one-time plan.
• Schedule a mid-year tax review with a CPA.
• Work with an estate attorney to create or update your estate plan.

Having a team on the bench, even if they’re only consulted as needed, provides peace of mind and reduces stress for your family.

Step 3: Get Organized

Organization is the foundation of preparedness. If your spouse needs to step in during a crisis, they’ll need quick access to essential documents and information.

Steps to Take

1. Create a Personal Document Locator: This guide lists the location of critical documents, from financial records to personal items.
2. List Professional Contacts: Include names, roles, and contact details for every member of your financial team.
3. Centralize Information: Store your balance sheet, investment statements, and other key documents in a secure, accessible location.

Pro Tip: Avoid forcing your spouse to hunt for important items like safety deposit box keys or account passwords. Simplify their experience by keeping everything organized in one place.

Resource: Use the Personal Document Locator template in your Planning Packet for a comprehensive organization system.

Step 4: Write an Investment Policy Statement (IPS)

An Investment Policy Statement (IPS) is a written document outlining your investment philosophy, goals, and strategies. It serves as a guide for managing your portfolio, especially if your spouse or a professional takes over.

What to Include in an IPS

• Philosophy: Define your beliefs, such as prioritizing low-cost index funds or socially responsible investing.
• Risk Tolerance: Detail how you approach market volatility and downturns.
• Asset Allocation: Outline your portfolio’s structure and rebalancing strategy.
• Long-Term Goals: Include objectives like funding retirement or leaving a legacy for your children.

Why It’s Important

Without a clear IPS, your spouse may struggle to replicate your investment strategy—or worse, fall victim to poor advice during a vulnerable time. A well-crafted IPS provides clarity and continuity.

Resource: Refer to the Investment Policy Statement Template in your Planning Packet for examples and guidance.

Step 5: Map Out Your Major Financial Moves

Planning for the future isn’t just about knowing where you are today—it’s about anticipating the major moves ahead. Mapping these moves provides a roadmap for your spouse and ensures your family stays on track.

Key Milestones to Plan For

• Working Years: Tax strategies, health insurance planning, and portfolio contributions.
• Early Retirement: Income management, healthcare options, and investment drawdowns.
• Legacy Planning: Long-term care needs, estate planning, and charitable giving.

Why It Matters

Life’s biggest financial decisions often come during periods of change or uncertainty. By mapping these moves in advance, you eliminate guesswork and help your family navigate confidently.

Pro Tip: Use visual aids, like timelines or flowcharts, to make your plan easy to follow.

The Value of a Comprehensive Plan

By taking these five steps—creating a live balance sheet, building a financial team, getting organized, writing an IPS, and mapping major moves—you’re giving your family the gift of preparedness. It turns out that the thing you'll have created through this process is a streamlined version of what we'd simply call a financial plan. rSafeguarding your loved ones is not just about managing wealth; it’s about ensuring they have the tools and support to thrive, no matter what happens.

For More Resources: Refer to your Planning Packet or reach out to us at Reach Strategic Wealth. We’re here to help you every step of the way.

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Download Your Free Planning Packet for When Something Happens to the Financial Spouse Here!