NEW YORK (AP) -- A week after celebrating her son's wedding, Polly Starnes was overwhelmed with grief when her husband died unexpectedly of a massive heart attack. Her pain was exacerbated by the financial decisions she faced.
''The bills are coming at you,'' said Starnes, 52, a Lynchburg, Va., counselor, as she recalled the weeks following her husband's death last year. ''It was really very, very stressful because I'd never had to deal with finances before. That was my husband's responsibility.''
The loss of a spouse is traumatic. But for Baby Boomers, those born between 1946 and 1964, the stakes are especially high -- many are at their peak of financial responsibility because of children and aging parents. As a result, financial planning becomes more important than ever.
''Older retirees who lose a spouse are more likely to have accumulated enough assets to be totally financially free. The classic Baby Boomer has not yet reached financial freedom,'' said Stewart Welch III, a certified financial planner in Birmingham, Ala.
''Instead they're still in the saving and accumulation stage. In particular, they're still paying for their children and the costs of educating them.''
Paying the mortgage, school tuition and other family expenses can be difficult for spouses used to depending on each other for financial as well as emotional support. Saving for retirement can also be a struggle because there are so many other bills to pay.
''In some cases, the cost of living may go up after the death of a spouse. A wife, for example, may not be able to do all of the maintenance her husband might have, while a husband may not be handy in the kitchen, so a family dines out more. There are also additional child care and retirement expenses to be considered,'' said Diane Maloney, a certified financial planner in Plainfield, Ill.
Even in cases where life insurance, Social Security, 401(k) proceeds or other financial resources are available, a widow or widower might feel confused about how the money should be spent or invested. There are a lot of other decisions to be made, including whether to keep a home or car.
''In hindsight, I probably would have done things differently. I would have invested the life insurance proceeds in ways so that a little bit more could be accessed easily, rather than all tied up,'' said Starnes, who used part of her husband's life insurance to pay off the mortgage on the family home.
''There were things I didn't think about, like the heat pump going on, the deck needing repair and other household maintenance my husband had always taken care of.''
Starnes said she also had to learn how to manage the household expenses, another chore her husband had handled.
Financial experts say new widows and widowers should avoid making quick decisions and instead seek financial guidance before writing any big checks or selling a home. An adviser can help put together a budget and assist in tax and general estate planning. In particular, the sale of home or withdrawals from a spouse's 401(k) account can have significant tax consequences.
''The surviving spouse may need to have a new will written. You need to look at life insurance again, as well as property and casualty insurance. Essentially all your documents should be reviewed. You really start from scratch in some ways,'' said Welch, the Birmingham financial planner.
Health insurance is another consideration if a surviving spouse received coverage from a policy held by a deceased husband or wife.
Women, in particular, stand to have the greatest financial problems after the death of a spouse because they tend to earn less than men.
''It's really hard to save more because there's only one income now. My husband made about three times what I did,'' Starnes said. ''Just paying the electric bill, the phone bill, the auto insurance, it all adds up. ''
The biggest challenge for Baby Boomer-age widows and widowers, though, may be balancing children's needs with their future needs.
''I wanted to invest the greatest portion of the estate money with the idea that it would go to my children's college education, but my financial adviser talked me out of it,'' said Kathy Rinehart, a school counselor from Plainfield, Ill., whose husband died in 1996 after an eight-month battle with leukemia.
''I had to consider the impact of the loss of income on the rest of my life and would need more invested for myself,'' she said. ''That was very difficult, because that was not how it was supposed to be. My husband I had planned on being able to help our children.''
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