Tuesday, February 13, 2007

Planning for disaster....no one wants to do it, but I suggest you do.

While in the shower this morning I began thinking about how my wife Cheryl and I planned for the future. My thoughts of course began with my thinking sadly of some of the plans we would never accomplish together.

But not wanting to be depressed, I quickly shifted gears over to all the things we had actually accomplished. I thought about all those right up to the events of December 21st when Cheryl left my world.

But this triggered even more thoughts, and that was of how over the years we had actually talked fairly regularly about worst case situations and recovery scenarios. Most of these thoughts centered around not out own comfort, but rather how we would continue to manage the responsibilities we had taken on in our life. (and trying to not overly burden whoever survived and had to take over those responsibilities)

The most obvious responsibility we understood we had was our kids. We had plans for them, or at least plans for ourselves and how we would support them as they grew up and into self-sufficiency.

Yea, I know, that sounds kind of like how and Engineer and an Accountant might look at things.....but then that's what a great deal of Cheryl and my education came from!

Before you go off and say "Hey, what were you two paranoid of?" It had nothing to do with being paranoid, and everything to do with understanding that we had to take responsibility for ourselves, and all the things we chose to do in life. We also were thinking about each other. Should one of us pass on, we wanted to make sure the other could continue the work we had started without too much extra strain.

When you take on the responsibility to have kids, or even pets, you need to think about it as a life-long calling. If you don't do that, you are shirking your responsibility and someone will surely call you on it later in life. (and you will not like it if it is your kids who do)

I'm not trying to me mean, or even suggest we were better than anyone....we made our mistakes, and we dropped the ball numerous times. But most of those were unintentional. I can honestly say that I believe we always tried to do the right thing. (and I hope I can continue to try)

SAVING WAS BASE: (but family and charity were in there too!)
We made frugal living and lack of debt the base of our plan. We tried to not be cheap, and wanted to support our family and community as best we could. We certainly saved, but should the school or one of the other charitable groups we volunteered with need something, we kicked in the time and often the money to get the item done.

But we tried to never go into debt, and we tried to make our savings goals a real target...like sending the kids to school.

Chery and I were always calculating a cash flow budget for the long and short term. We had goals for savings every year, and we never blew the money if we topped our goal. We knew we had to save for a rainy day.

We never dwelled on it, but we did discuss the possibility that bad things might happen. Both of us had cousins or uncles who had been in accidents, and we saw first hand what the lack of planning had done.

We tried to have just enough insurance to get us over the rough spot.

We decided to pick-up life insurance in about 2002. (If I recall) I think it was based on the fact that the girls were about ready to go to school, and the job market was rocky. (I didn't get laid off until about early 2004, but the economy was rough)

I had insurance through work, but what happened if I lost my job. We would be instantly uninsured, and at a time when we were least capable of paying for it.

So the concern for my passing was the enough money to not only pay for the arrangements, but to pay off the house and get the girls through school. With those things paid off, Cheryl would have lower cash flow needs, and would be able to make ends meet on her salary.

My situation was a bit different. I had the bigger income, and would be able to afford the school costs.....but had to get the non-discretionary spending down a bit....so I think we decided on a much smaller amount because my income was much healthier.

The key was that we had a plan, and we tried to make it a good plan end-to-end. (with our day to day approach to spending to our purchase of life insurance)

My planning is not over......our family is far from wealthy, and I still have the goals for my daughters education and my own retirement. But I'm glad we took the steps needed to plan and set ourselves up for all contingencies.

No one wants to see the worst come, but who wants to think of leaving the world and leaving your dependents alone AND unable to tread water financially.

Do it for your spouse....do it for your kids.

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A well informed matter.

3:32 PM EDT  

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