01. Where Will The Family Live?

One of the first questions that must be answered in developing a plan for surviving family members is whether the family should continue to live in their present home, especially during the dependency period of children. Other aspects of planning will be profoundly effected by this decision, include retirement.

When the family home is in a nice neighborhood with good schools and established friendships, having to move can be a terribly difficult and emotionally disturbing event. The loss of a parent is probably the greatest emotional shock that can occur to a child or retired person. Losing the sheltering comfort of their home and friends, and having to move to a strange, and perhaps less desirable neighborhood at such a time deepens the sense of loss, and makes adjustment much more difficult, especially for young children and retirees. .

Moving back home with the wife's parents or your children after the death of a husband or wife is often considered. But one must be careful not to romanticize about how parents will welcome sharing their home and altering retirement plans to accommodate children and grandchildren.

Even when a move is desirable, adjustment problems can be reduced if the family can remain in their present home for a year or two. Children can change schools with minimum disruption, and the house can be retained until it brings a fair price.

When both husband and wife are working or receiving retirement income, the loss of income upon the death of either one may force the sale of the home unless funds are available to liquidate the mortgage or continue monthly payments. It always takes less money to pay off the mortgage in a lump sum than it does to provide for the monthly payments.

When providing life insurance to pay off the mortgage, it is preferable to have the proceeds paid to the surviving spouse, and not directly to the lending institution under a mandatory contract. If circumstances dictate that the house be sold, it is often easier to sell it subject to an existing mortgage than to require that the buyer provide his own financing.

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