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When a spouse dies, Suze Orman’s advice is refreshingly simple: slow down.
“The one crucial piece of advice I have for the surviving spouse is to move slowly and make as few financial decisions as possible,” she writes, in advice recently highlighted by Moneywise. (1)
She suggests parking life insurance money in a bank or credit union for a year or more, and warns that grief “makes you a target for unsavory people who will tell you they have your best interests at heart.” (1)
I agree with every word. I’ve been a CPA since 1981, was formerly a Wall Street investment advisor, and was the executor of my parents’ estate. I know how fast the paperwork piles up, and how quickly “opportunities” show up at the door.
But “do nothing” has fine print. A handful of things can’t sit for a year. Social Security won’t pay benefits you don’t claim. (2) The IRS still expects a final tax return. (3)
And people 60 and older reported $2.4 billion in fraud losses in 2024, with the true cost estimated as high as $81.5 billion, according to the FTC. (4)
Here’s what Suze gets exactly right — and the four things I’d put on the calendar right away.
What Suze gets exactly right
In practice, slowing down means not rushing to sell the house, buy an annuity, lend a relative money or hand your savings to the first friendly adviser who calls. Those are big, hard-to-reverse decisions, and grief is a terrible time to make them.
Parking insurance proceeds in a federally insured bank or credit union account isn’t exciting. That’s the point. It buys you time to think.
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1. Tell Social Security — and learn your options before you choose
A surviving spouse can collect survivor benefits starting at 71.5% of the late spouse’s benefit, rising to as much as 100% at full retirement age. (2) Spouses may also get a one-time $255 death payment. (2)
If you qualify for both survivor benefits and your own retirement benefit, you don’t get both — you get the higher one. But you can switch later. For example, you could take survivor benefits first, then switch to your own retirement benefit at 70 if that’s the bigger check. (2)
This is one place where moving slowly can pay. Just make sure you understand the choice before you make it, not after.
2. File one last joint return
Generally, you can file a joint return with your late spouse for the year of death. (3) That usually means the more generous married tax brackets and standard deduction, one final time.
After that, most widows and widowers file as single. If you have a dependent child, you may qualify as a “qualifying surviving spouse” for the next two years, which keeps joint-return tax rates. (5)
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3. Write down what everything was worth on the date of death
This is the tax break I see families lose most often. Inherited property generally takes a tax basis equal to its fair market value on the date of death. (6) It’s called a “step-up.”
Say your husband bought stock decades ago for $20,000 and it was worth $120,000 when he died.
The part you inherit is generally treated as if you paid what it was worth that day — which can wipe out a big chunk of taxable gain when you eventually sell.
How much of a jointly owned asset gets the step-up depends on how it was titled and where you live.
The catch: you have to prove the value. Get brokerage statements as of the date of death now, and consider an appraisal on the house. It’s far easier today than five years from now.
4. Decide on ‘portability’ before the window closes
When the first spouse dies, the estate can transfer that spouse’s unused federal estate tax exemption to the survivor. It’s called portability, and it requires filing an estate tax return — normally due nine months after death, with a six-month extension available. (7)
Smaller estates that wouldn’t otherwise have to file get more breathing room: up to five years after the date of death under a special IRS procedure. (7)
With the 2026 exemption at $15 million, almost nobody will owe federal estate tax. (7) But portability is cheap insurance if your wealth grows or the law changes. Ask a tax pro whether it makes sense for you.
5. Then update your own plan
Here’s the one almost everybody forgets. Your own will, trust and beneficiary forms very likely name the spouse you just lost. Once the fog lifts, fix that.
A will locks in exactly who gets what — and you can create one in minutes for $199. A trust goes further, controlling how and when heirs inherit. You can get one starting at just $499. One hour now protects your family and prevents bitter fights.
6. When you’re ready, get help from someone who has to put you first
Suze warns about people who claim to have your best interests at heart. The answer is working with someone who’s legally required to.
This is a good time to get a second set of expert eyes. A good place to find one is by using SmartAsset. They match you, free, with up to three fiduciary advisors — legally required to prioritize your interests. They spot tax savings, Social Security strategies, and planning gaps you’d never see alone, as well as many of the other things discussed above. $100K+ in investments? Get matched free in minutes.
The bottom line
Grief doesn’t come with a deadline. Unfortunately, the government does.
Suze Orman is right that the worst financial decisions are the rushed ones. So take her advice: slow down on anything big and permanent. Don’t let anyone hurry you into buying, selling or signing.
But make a short list of the things that can’t wait — Social Security, the final return, date-of-death values and the portability decision — and get them handled. Then give yourself all the time you need for everything else.
Sources: 1. Yahoo Finance (Moneywise); 2. Social Security Administration; 3. IRS Publication 559; 4. Federal Trade Commission; 5. IRS Publication 501; 6. IRS; 7. IRS
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