A friend of mine’s husband was recently diagnosed with cancer. He has no life insurance. They have two sons, one in college and one in high school. I’m hoping he will beat his cancer and have many years ahead of him to love his family. But, if something does happen, this mom will be in bad financial shape. It’s easy to let financial matters slip by and never save money or plan for the future. We’re so busy we don’t have time to research our options, or we put it off because we already feel stretched financially and looking into our finances will just stress us out more.
So, whew, take a deep breath. Here are three things you can do this week to deal with the financial nitty-gritty of your life. Believe me, taking the time to do this will actually relieve some of the stress you feel.
1. Get a baseline.
What’s your income? What do you owe? What do you have in savings and in retirement? Do you have a college plan for your kids? Do you have a mortgage or an equity line? What about car payments or other items you’re financing?
Sit down with your husband to answer these questions. If talking about finances is a hot button issue for you two, take a look at these ways to stop fighting about money.
And, show your husband this article from AllProDad.com about a quick approach to debt-free living.
2. Start tracking.
At the beginning of 2019, I tracked every penny that went out the door. It was eye-opening. I only tracked for one month, but it was long enough to show me where my dollars went and where I could cut back. It also made me more hesitant to buy things on the fly.
So track your spending. There are a number of easy ways to do it. Check out apps like Every Dollar and Mint. You could also use a Google Sheet.
And here’s something else to think about… this past weekend I drove past a garage sale at a very nice house. The driveway was lined with lots of house decor from stores like Home Goods, and probably from Target and maybe even Restoration Hardware too. It struck me that all of those odds and ends likely added up to a lot in the money spent for them, and now this family was getting pennies on the dollar!
Before we spend another dime on things for our house, let’s put our financial house in order… speaking to myself, here.
3. Get the biggies.
If you and your husband don’t have tons of money saved for “just in case” — you need life insurance on both of you. I have a $100,000 policy that will help pay for my children’s education. If I die before my children leave home, I want to plan ahead so financial matters won’t derail our family in my absence. My policy costs about $48 a month. We also have policies for my husband.
The other thing to look into is your retirement plan. A friend of mine was a speaker at an event where Warren Buffet was also on the program. “What’s the best way to invest?” my friend asked the financial guru. “Keep it simple,” Buffet said. “Just follow a plan of dollar cost averaging.”
All that means is to contribute regularly to your retirement plan and let it do its thing.
We have lots of great material on finances, with lots more detail, in our family finances section. Check it out and let us know how it helps.
Tell us! What financial decision has helped the most in your life?
