Creating a New Budget After The Death Of A Spouse

Hi,
Each person's situation is different. These are some general suggestions which may apply to someone who is creating a new budget following the death of a spouse. After identifying all existing assets, liabilities, and expected income sources, we should have a better idea of what needs to be done and what steps need to be taken. If one owns an house and decides to move, one has three options available:
1) sell the house through conventional means
2) sell the house and carry the contract, which will generate a substantial monthly income
3) rent the house, which will produce a monthly income (Investigate a property management firm to handle property if one is unable to manage it alone, but want to keep the house as an investment)
If one's investment portfolio contains only stocks, talk to the broker about moving investments into a monthly income producing investment vehicle.
Now that we know when funds will be received from life insurance, property sales, and investment portfolios etc., we can communicate with creditors to tell them approximately when we will be able to resume payment. In order for the surviving spouse to maintain future credit standing, it is important to communicate with creditors as soon as possible to let them know the status of the situation.
For people who don't have an estate, and the funds are not available to make the monthly payments of the deceased, creditors need to be contacted as soon as possible to be notified of the situation. Request that they freeze the interest on the bills until such time as the funds are available to resume payment. If income is reduced to the point that it seems as if funds will never become available to handle these debts, one should talk to one's banker or trusted friend familiar with finances, to formulate a plan to seek sound professional help.
It's important to take some time to identify the approximate expenses which will be incurred on a monthly basis. In some cases there will be no leeway and in other cases, significant leeway of what monies can be used for monthly expenses. In certain instances it might be necessary to spend less time eating out than is habitual. Weekly activities which cost money may need to be replaced with economical or free ones. Check the library and Internet for local activity listings. Reduced income might necessitate paying attention to the cost of goods and services as someone transitions into a new lifestyle.
Next week I'm going to write about the economic impact of divorce.
Have a good weekend!
Until then,
Alan