Given my interest in this subject, from time to time friends will relay a story of what unexpected things happened following a major illness or death. Here are a few you should look into to see if you can easily remedy.
1. Credit Cards:
Issue: Cards that are issued to one spouse, with the other listed as an additional cardholder, will often be automatically cancelled on the death of the spouse. Say, for example, you have an American Express Gold card, which was taken out in your husband’s name, and you are the additional cardholder. He dies, and it is noted in a local paper in the obituaries. Services who look for this information pass it on to credit card companies, leading the card company to cancel the card, even though it has two cardholders. If you are not sure who is the named cardholder, look at the bill: that person is the named cardholder.
Remedy: Each of you would be well advised to have a card in your own name, or perhaps 2-3, depending on how much you use them. Over time, when they are paid off promptly, and your credit rating stays strong, the spending limit will gradually rise, giving you each room in later years to be covered in the event that a joint card is cancelled. (It is always a good idea to discuss this with the card company, as their disclosure statements governing accounts change over time.)
2. Joint Bank Accounts
Issue: Banks, when they are notified that an individual has died, will put a freeze on the account, until they have the documents that show who has authority to access the funds. This takes time, at a time when you will need access to ready cash for immediate expenses.
Remedy: Have a separate account in each of your names, with a way to transfer funds from your own investment account to replenish cash in your checking account. This can be done easily if you have a Living Family Trust estate plan. Discuss this with your attorney, and once you have that set up, then change the title to each of your accounts to the title of your share of the Trust. As you do this, you will be working with your banker, and they can help to ensure that it is done correctly.
3. Health Insurance While Traveling outside of The United States
Issue: You are traveling in Europe, and suddenly your spouse suffers a heart attack. He is taken to the local hospital and stabilized.
Remedy: There are really two questions to resolve in this situation, with a suggested remedy for each:
i. Does your insurance take care of medical expenses when you are outside the country? You need to check with your primary insurer as well as your supplemental insurer, as often those expenses are not covered. You can purchase additional insurance just for this purpose.
ii. What if you feel your spouse would get better care at a hospital and with a doctor back in the United States? This involves medical evacuation, which is very expensive. But there are policies that can be purchased as insurance in case this happens, and you could ask your insurance agent what the options are. Some organizations offer this for a small annual amount for their members, so look into that, as well.
In all cases, check into your options well before you take a trip out of the country, especially if one or both spouses have had health issues. You would be surprised how often this happens, and it is a mess scrambling to find solutions when you are up against a short time frame. It can also be very expensive, if you have not planned ahead.
Photo by NASA