Consumer Reports Finds Some Overlooking Basic Financial Precautions
PITTSBURGH (KDKA) — Ten years after Karen Mendelsohn and her husband, Harold, were married, he went to take a run and never came back.
“He suffered a sudden heart attack,” Mendelsohn said. “It was horrible and they couldn’t revive him.”
The second blow was that neither she, nor their two young children, was named as the beneficiaries on his pension. He had neglected to switch it from his parents’.
“They said ‘no,’” Mendelsohn said. “They said if our son left us as the beneficiaries, he wanted us to have the money.”
Consumer Reports says financial oversights are all too common.
“Our survey found that in the last five years, 86 percent of respondents had not checked or updated important estate documents, including wills and beneficiary designations,” Tobie Stanger with Consumer Reports said.
Financial planner Gayle Lob says another frequent mistake couples make is having only one person in charge of the finances.
“What if somebody gets disabled?” Lob asked. “What if one of them dies?”
Consumer Reports confirms that “money stumble” is common with married couples.
Its survey found with 70 percent of couples, only one spouse knew key details about their accounts.
“And if you are over 60 and have adult children, it’s time to let them know where that important information is as well,” Stanger said.
Other “money stumbles” include that 50 percent of homeowners did not have enough insurance to cover full replacement of personal property at today’s prices.
And more than 70 percent didn’t have at least three months of living expenses set aside in case of job loss or illness.
“You may not solve everything all at once, but just taking those first simple steps may save you and your family a lot of heartache down the road,” Stanger said.
As for Mendelsohn, it took a lawsuit to get her husband’s death benefits.
She says she hopes telling her story will encourage others to get their finances in order.