Managing money matters after the death of your partner

By Rick Lauber

When a husband or wife passes away their partner is left grieving, with a funeral to plan and a potential mountain of belongings to sort through. But that’s not all. The surviving spouse is also left with a new, perhaps worse, financial situation. Pension benefits will change and expenses will no longer be split. With potentially less money coming into the household, the remaining senior must now consider ways to manage day-to-day life on their own. Thinking and planning ahead can make some matters easier, so consider these tips:

Ask for professional advice

Managing money matters becomes a more efficient process when there is a will. In a best-case scenario, the deceased partner will have recently reviewed this document and made any necessary adjustments. When faced with “final requests,” it is usually necessary to consult with any or all of a banker, financial planner, accountant or lawyer. Be sure to ask for a quote for services ahead of time. Find out if you qualify for legal aid or check if the firm has an articling student (whose work is checked over and approved by a senior lawyer at a considerably reduced rate).

Inheriting debt

A debt will remain only if the surviving spouse co-signed a loan with their partner. Otherwise, the debt does not become your responsibility to pay off. Contact a credit score agency such as Equifax Canada ( for a credit report to see where you stand. As a surviving spouse, you will need to supply the agency with your partner’s complete legal name and social insurance number, your full name and address, and a copy of the official death certificate.

You will also need to send photocopies of the death certificate to all creditors to release you from any unwanted obligation to repay an outstanding debt. On a related note, destroy all of your spouse’s credit cards (either cut them into small pieces or run them through a hardy shredder).

Be aware of collection agencies

These companies will try to collect on past debts, and most will not be entirely sympathetic to hear about a partner’s death. In fact, collection agencies may use this time to their advantage to lean on the surviving spouse and pressure them into paying the debt in full (an often effective, but not completely ethical, approach). To stop their phone calls and notices in your mail, simply send the death certificate to the collection agency as proof of passing.

Understanding reverse mortgages

Financial institutions have been aggressively marketing reverse mortgages as a tool to supplement retirement incomes. It may sound like an attractive idea, but please exercise caution. With these loans the equity in your home is provided as security, and repayment of the principal or interest is not required until after the home’s final resident has passed away. You can, of course, repay a reverse mortgage early (perhaps with a penalty). The money you “borrow” from the equity can be used for home repairs, healthcare expenses or any other bills.

If you are considering a reverse mortgage, first book an appointment with your bank manager to discuss the following:

  • Your existing mortgage (if you still have a mortgage on your home, the reverse mortgage must be used to pay off that loan first).
  • The repayment time period after a spouse dies
  • Penalties if your loved one’s estate cannot pay back the complete amount of the reverse mortgage within the specified time period.

Applying for a line of credit

This is another tool offered by banks and credit companies, but lines of credit often come with a steep price tag. Here, the surviving spouse can apply for and receive a lump sum of money (often with few questions asked). Payback arrangements include a higher rate of interest than a regular mortgage or loan—I’ve heard of cases where it’s so high that the surviving spouse may be unable to pay the “minimum amount due” each month. (And this is usually only the interest, not the principal.)

Savings and assets

One of the most common saving tools that many older adults have is a Registered Retirement Savings Plan (RRSP). If the surviving partner is named as a beneficiary then this money will be transferred to them (an easy process). Conversely, where the surviving partner is not named as a beneficiary, the money gets transferred to the estate (and will be taxed).

A similar process is in place with owed property… legally married spouses will receive sole ownership (if named in the will), while common-law spouses will not. In the eyes of the Canada Revenue Agency (CRA), other assets owned only by the deceased (e.g. collections, investments, vintage vehicles, land) are considered as being sold just prior to death. The CRA will assess these assets as a capital gain for the surviving spouse and tax them accordingly.


Upon the death of a married spouse, Canada Pension Plan (CPP) payments can be transferred to the surviving spouse. However, this is not the case with Old Age Security. If your spouse has made sufficient contributions to the CPP then you may be eligible for survivor benefits. The three types of benefits offered include:

  • Death benefit
  • Survivor’s pension
  • Children’s benefit

More information can be found in the ‘public pensions’ section at

Shares and other income

If you have read this far, it should come as no surprise that the deceased partner’s shares are inherited by the surviving spouse (if so named in the will). If the married couple was receiving rental income from another property then the surviving spouse becomes the sole landlord, but must honour the terms of the lease (i.e., a tenant can remain for the term’s duration). Seeing the lease through to the end gives the surviving spouse time to make a clearer decision as to what to do with the rental property.


With no partner, the surviving spouse may have to make do with a reduced disposable income. Try these ideas to make savings:

  • Sell your spouse’s car and other equipment or tools that you won’t use.
  • Cancel your partner’s cellphone, subscriptions and memberships.
  • Use a debit card instead of a credit card for purchases (to reduce the risk of high interest rates).
  • Contact utility companies to ask about fixed monthly payments.
  • List the home for sale and move into a smaller residence close to family.
  • Ask about senior discounts (e.g., meals out, haircutting, movie admissions).
  • Rather than buying, use your local library to borrow books, films and music.

Refer to the Government of Canada’s “Budgeting During Retirement” webpage to learn how to create and follow a regular budget.

Step by step

When a life partner passes away, the surviving spouse will need to take time to assess the situation and make some very personal choices. If there is an executor, they will be able to help you out when it comes to probating the will. Probate is the process by which a court confirms that a will is valid. The process involves fees. In Ontario, the fees are $250 for the first $50,000 of the estate and $15 for each additional $1,000, with no upper limit.

Dealing with the will is usually the first step after the funeral. The second is to review housing, caregiving and other daily life circumstances necessary for the surviving spouse and, of course, to sort out a plethora of other matters.

Depending on the situation, financial matters will be high on the list—for better or worse—and life adjustments may need to be made. Without a doubt, it is difficult to think about money when you are dealing with swirling emotions and all sorts of other disruptions. However, according to certified financial planner Rona Birenbaum, the process “can actually blossom into something more positive. Once widows come through the dark days and experience what it’s like to take control of their financial future and then start to live into that future, what they’ve lost is always lost, but then they can start to gain something. Sometimes it’s just actual surprise that they’re stronger than they thought they were. I start to see a new life emerging for many people, and it’s a beautiful thing.”

To hear a real-life account, read Laurelea Conrad’s experience when her husband Steve passed away: “Nobody plans to be a widow—but you should be prepared if it ever happens” is available on the blog at

Take care of the most pressing financial issues first

Since the period immediately following a spouse’s death may be the most stressful, avoid making major financial decisions during a time when your decision-making abilities may be compromised.

Don’t be hasty with career decisions

If you had a job at the time of your spouse’s death, think twice before deciding you’re too devastated to continue with your work. A job, of course, provides steady income, but some also find other benefits to working following a spouse’s passing.

Consider whether to adjust your investments

Before your spouse died, he or she may have favoured a particular investment strategy. You may decide that strategy isn’t the right fit for you. You may also decide to direct some of the money from death-related benefits to new investments. As with any investment decision, it’s important to do your homework before leaping into the market, and try not to let emotions that can cloud financial judgement get in the way.

Be careful about home decisions

Some survivors may be tempted to quickly sell their homes following a spouse’s death. While emotionally, that may feel like the right choice, it could be the wrong one. If the housing market is in decline at the time you want to sell, for instance, you may be better off waiting until a recovery is afoot.

Wait to change your joint accounts

It’s not about nostalgia: it’s practical to leave your spouse’s name on your joint checking account for about a year because, during that time, you may still find yourself receiving checks in his or her name.

Beware of fraud

Unfortunately, there are many stories about senior people—particularly, single seniors—being exploited by scammers. If you worry that you’re being targeted, you can reach out to a family member or trusted advisor.


Rick Lauber is a published author and freelance writer. He has written Caregiver’s Guide for Canadians and The Successful Caregiver’s Guide (Self- Counsel Press). Visit

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