Cash Flow Gaps Add to Grieving Families' Pain: Empathy

What You Need to Know

Empathy offers a package of support services for grieving families.
It notes that many have to use checking accounts and credit cards to pay to settle estates.
Another problem it sees is skimpy employer bereavement leave.

Lack of quick access to cash often makes the practical problems facing bereaved U.S. families pool worse, according to Empathy, a firm that provides services for grieving families

The company estimates in a new report about final arrangements that only about 14% of bereaved families have access to life insurance, final expense insurance or other dedicated funds to pay the legal bills associated with settling the estates of loved ones who have died.

The report also includes data on other topics related to the arrangements made after loved ones die.

The average bereaved family spends about $5,000 on legal matters.

That total includes an average of about $900 going to pay for a lawyer and legal fees, and the rest going to preparing and selling assets such as houses, the firm says.

About 42% of families use credit cards and checking accounts to pay those costs, and 36% use their savings to pay the bills.

What It Means

Many clients might need help with understanding, managing and saving for the costs associated with the deaths of loved ones, and they also need help with planning for their own final expenses.

Empathy

Empathy is a New York-based firm that offers a package of support services, tied to a website and a mobile app, designed to meet some of the needs of grieving families.

The Report

Empathy based the new report in part on a survey of 1,485 Americans ages 18 and older who had been affected by the loss of a loved one in the last five years. About 40% had been an estate executor or administrator.

The firm says dealing with the death of a loved one is often much more expensive, complicated, time-consuming and emotionally draining than employers who have not been in a similar position understand.

Simply arranging a funeral, for example, costs an average of about $8,000, and 74% of affected employees had to take time off from work.

About 76% of the participants said dealing with the death of a loved one had hurt their performance at work.

A typical employer offers just one to five days of bereavement leave, and that’s no enough, the firm says.