Dear First Responder or Military Member,
You're always looking to protect or help those in need. Firefighters, you risk your life to run into a fire to rescue someone. Police officer, you would run towards the shooter if it meant saving the life of an innocent person. Military member, you'd risk your life to protect inocent civilians of another country in order to take down the enemy. You give all you've got to keep others safe.
BUT... I have a question for you. Are you being the financial protector of your family? Are you ensuring your families safety when it comes to money? Or, are you stressed about money? Are you fleeing the budget conversation because you know you're spending more than you make? Do you know that you have a large enough emergency fund in case you were injured or lost your job and were out of work for a while? Do you know your family is protected with enough life insurance if you were to die serving others?
Risk is often part of the job, but it shouldn't be part of your financial preparedness for yourself or your family.
Here are three things you need to have set up in order to take the risk out of your money.
Budget - Have a budget so you know how much money is coming in each month and how much is going out. You want to list all of your income first. Next, you want to list all of your bills and expenses such as:
your mortgage or rent payment
You need to know where your money is going. This alone will reduce your anxiety levels and give you a plan.
2. Emergency Fund - You need 4 - 6 months of expensives sitting in a savings account you will only use for true emergencies. I suggest using a high yield savings account. The goal isn't to make money on this savings, it's simply to ensure that the money is there in case you need it. If your A/C unit goes out, job loss, unexpected medical bills, etc, you will have security in knowing, yes this emergency stinks, but at least you have the money to cover the costs.
3. Life Insurance - If you have a family, you need at least 10-12 times your annual income in term life insurance.
Example: If you make $75,000 a year, you need to have a policy of at least $750,000
Military members, your SGLI is probably not enough! When my husband was in the Army, the max I believe you could get was $400,000. That's not enough to cover your families expenses for very long. Yes, you might look at your income, living on post and think you only make $30,000 a year. But you are not counting for the price of housing your family will have to afford when they are no longer on post. Consider how much you really need to provide for your family in the event of your passing.
Make sure your spouse has life insurance too!
Give yourself the peace of mind knowing that if you were to leave this earth, your family will be taken care of. 10-12 times your annual income will allow your family time to grieve your loss and find ways to supplement your previous income. It will allow your surviving spouse to pay off your house so they don't have to worry about a mortgage payment anymore. It can allow for your children to get the education they want and remember that you were the one who paid for it. It allows your legacy to continue even after your death.
You take care of everyone else, be sure you are protecting yourself and your family too.
If you would like to discuss how to do this, book a free consultation so we can discuss your goals.