Women & Money

The Future Of Wealth Is Female

Financial challenges hit harder for widowed women

They have more debt, less savings and lower confidence in managing their finances, according to a new survey from Thrivent. View the report here.

MINNEAPOLIS, June 12, 2024 /PRNewswire/ — A new Thrivent survey reveals over half of widowed women experienced financial challenges after their spouse’s passing, with 51% either living paycheck to paycheck or struggling to manage their bills. A lack of proactive financial planning could be to blame: 41% of the widowed women surveyed said they didn’t have any financial conversations or plans in place prior to their spouse passing away.

“Losing a spouse is one of the hardest things anyone can experience,” said Teresa Powell, Thrivent financial advisor. “Immediately after this terrible loss, many widowed women face a tremendous financial burden without a solid plan in place. While nothing can protect against the heartache of losing a spouse, creating a financial plan with your spouse ahead of time is one of the greatest acts of love you can do for one another.”

Other key findings from Thrivent’s survey underscore why financial preparation is crucial married couples:

  • Lack of preparation: A majority of widowed women (60%) reported the loss of their spouse as unexpected. Yet only 29% of all widowed women created a will with their spouse while they were together, 6% regularly met with a financial advisor and 5% had developed a written financial strategy.
  • Debt dilemma: Debt is one of the top financial challenges facing widowed women. Thirty-nine percent carried over $25,000 in debt immediately following the loss of their spouse, including 10% having over $100,000. Additionally, 71% said losing their spouse made paying off debt moderately or much more difficult, reinforcing how much they may have relied on their spouse for financial support.
  • Financial uncertainty: Less than half (48%) of widowed women felt prepared to manage their finances after the death of their spouse. Their primary concerns included becoming the sole financial decision-maker or paying monthly bills on time (70%). Many also struggled with budgeting on a reduced household income (44%), managing and paying debt (37%), and continuing to save for retirement on one income (21%).
  • Immediate financial changes: A majority of widowed women (68%) made immediate changes to their financial activity. Among the most common, 35% of widowed women had to reduce or stop spending on non-essential items or activities, 14% had to pull money from retirement savings to cover expenses, and 11% reduced or stopped contributing to savings.

These findings point to a need for proactive financial planning. A financial advisor can be an important partner in planning for the unexpected and supporting widowed women as they address their immediate financial needs after the death of a spouse.

Here are tips from Thrivent on navigating finances before and after the loss of a spouse:

  • Start financial conversations early – Couples should openly discuss their financial goals, financial plans and end of life wishes with each other. They should also share their financial documents, records and passwords with their spouse. By taking a proactive approach, surviving spouses will have the information and clarity they need to make smart financial decisions following their loss.
  • Adopt a change mindset – While people are commonly encouraged not to make major life decisions shortly after losing their spouse, financial changes may be unavoidable. Recognizing this impact and making strategic and thoughtful decisions, with the support of a financial advisor, can help the surviving spouse safeguard their finances now and into the future. Embracing a change mindset can be empowering for widowed women as they navigate their next chapter.
  • Map out what’s next – After losing a spouse, widowed women often encounter new financial challenges, from how to budget and save on a single income to understanding their new tax filing status and Social Security survivor benefits. A financial advisor can help them map out key financial decisions in the short and long-term and offer tailored advice that meets their needs.
  • Plan with the right team – Industry research shows an estimated 70% of women leave their financial advisor within the first year of their spouse’s death.1 This underscores the need for couples to work together now to build an experienced team that aligns with their values and helps them navigate complex financial decisions. Ideally, the team should include a financial advisor at the center, with support from an attorney and CPA to advise on legal and tax questions. This helps ensure the surviving spouse is well-positioned to accomplish their future goals.

 

 

 

Survey Methodology
This survey was conducted in May 2024, among a national sample of 422 Female Widows. The aim was to understand the financial preparedness and challenges faced by widows. The interviews were conducted online, and the data were weighted to approximate a target sample of adults in the United States based on gender, education, age, race, and region. Results from the full survey have a margin of error of plus or minus 5 percentage points.
[1] The Future of Wealth is Female: Working with Female Clients Through Their Various Life Journeys
About Thrivent
Thrivent is a diversified financial services organization that helps people achieve financial clarity, enabling lives full of meaning and gratitude. Thrivent and its subsidiary and affiliate companies serve more than 2.3 million clients, offering advice, insurance, investments, banking and generosity products and programs online and through financial advisors and independent agents nationwide. Thrivent is a Fortune 500 company with $179 billion in assets under management/advisement (as of 12/31/23). Thrivent carries ratings from independent rating agencies which demonstrate the strength and stability of the organization, including an A++ rating from AM Best; an Aa2 rating from Moody’s Investors Service; and an AA+ rating from S&P Global Ratings. Ratings are based on Thrivent’s financial strength and claims-paying ability, but do not apply to investment product performance. For information on these ratings, visit the rating agency’s website. Dividends are not guaranteed. For more information about Thrivent, visit Thrivent.com or find us on Facebook, Instagram and LinkedIn.
Insurance products, securities and investment advisory services are provided by appropriately appointed and licensed financial advisors and professionals. Only individuals who are financial advisors are credentialed to provide investment advisory services. Visit Thrivent.com or FINRA’s BrokerCheck for more information about Thrivent’s financial advisors.
Thrivent and its financial advisors and professionals do not provide legal, accounting or tax advice. Consult your attorney or tax professional.
Thrivent provides advice and guidance through its Financial Planning Framework that generally includes a review and analysis of a client’s financial situation. A client may choose to further their planning engagement with Thrivent through its Dedicated Planning Services (an investment advisory service) that results in written recommendations for a fee.
About Morning Consult
Morning Consult is a global decision intelligence company changing how modern leaders make smarter, faster, better decisions. The company pairs its proprietary high-frequency data with applied artificial intelligence to better inform decisions on what people think and how they will act. For more information, please visit morningconsult.com.