“Don’t light yourself on fire to keep others warm” – it seems like such common-sense wisdom, but in reality we do it all the time. Many of us are unfortunately in situations where we have family members including parents, siblings, children, or even grandchildren who for one reason or another may not be able to completely take care of themselves and need help. Sometimes it is unforeseen tragedies like a hurricane or illness, other times it is their own inability to manage money or they just never seem to quite “get it together."
We know they need help, we know we have money, and so we give to them with best intentions. But how do we know how much we are actually able to give? What happens if tragedy strikes us or our spouse, will we be able to weather the storm?
Too many times I see caring family members over-extending themselves to help. It’s kind of like being on an airplane and the oxygen masks come down, we need to put the mask on ourselves first and then on our children or others who need help. If we help them first we run the risk of passing out and creating a bigger problem? They may not even be able to pull us off the plane!
Having a written financial plan that documents what you need to do in order to have be on track for financial security is like putting your oxygen mask on first. It should cover what you need to save to be on track for retirement, how much you will need in emergency reserves, and what kind of insurance you need to consider to protect yourself (or your spouse) against disasters like disability, sickness, and premature death. Once you understand what you need to put away so that you can put food on the table and a roof over your head for the long run both in good times and bad you know what you have left. Once you know what you have left you know what you can give and you ease the burden of anxiety on yourself.
Remember, if you are not in a good position in the future you not only are not able to help them, but you are now part of the problem and may yourself require assistance from other family members creating two challenges where there was one. By knowing what you need in order to have enough you can keep from growing the problem and ease your own uncertainty about what resources you really have available to help.
As a Financial Advisor and CERTIFIED FINANCIAL PLANNER® practitioner, I help families figure out these and other challenges. I do not have any requirement to manage assets, and you do not have to buy any products from me. I can help you design a plan for a fee.
This article was written by Brendan Pheasant, CFP®, AIF®, ChFC, CPFA - Financial Advisor
Separate from the financial plan and our role as financial planner, we may recommend the purchase of specific investment or insurance products or accounts. These product recommendations are not part of the financial plan and you are under no obligation to follow them.
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Financial Advisors do not provide tax or legal advice. Please consult a tax or legal professional for advice regarding your specific situation.
Brendan is a registered representative and investment advisor representative of CRI Securities, LLC and Securian Financial Services, Inc.
North Star Consultants, Inc., Insurance Products and Services I CRI Securities, LLC., Securities, Investments and Investment Advisory Services Securian Financial Services, Inc., Variable Products, Securities and Investment Advisory Services North Star Resource Group offers Securities and investment advisory services offered through CRI Securities, LLC and Securian Financial Services, Inc. Members FINRA/SIPC. CRI Securities, LLC is affiliated with North Star Consultants, Inc., North Star Consultants Texas, Inc. and Securian Financial Services, Inc. Securian Financial Services, Inc. operates under separate ownership from North Star Consultants, Inc. and North Star Consultants Texas, Inc. North Star Consultants Texas, Inc. doing business as North Star Consultants of Texas in the state of Texas. 1917038/DOFU 10-2017