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welcome to the best interest podcast
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where we believe Benjamin Franklin's
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advice that an investment in knowledge
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pays the best interest both in finances
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and in your life every episode teaches
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you personal finance and investing in
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simple terms now here's your host Jesse
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Kramer hello and welcome to episode 84
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of the best interest podcast my name is
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Jesse Kramer later in today's episode
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Andy Hill is going to be joining us
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again to dive deep into some of the
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financial topics surrounding uh being a
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new parent I figured it would be a fun
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time to have that conversation as my
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wife and I welcome our first child into
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our lives but first a couple messages
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some housekeeping and a little bit of
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monologue I wanted to thank you guys for
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all of the terrific Ama or ask me
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anything questions that are coming in if
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you haven't listened to episode 81 yet
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it's our first ask me anything episode
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it's already the fastest downloaded
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episode in the history of the best
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interest podcast it will soon probably
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be the most downloaded episode and I I
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think it's very good and and listen if
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you guys like it keep on sending those
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questions in let me know that you like
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it and I'm going to keep on putting out
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episodes like that because I think it's
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very useful to answer your direct
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questions I've always talked about how I
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don't want to fall victim to audience
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capture right where the wants and needs
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of an audience really pigeon H holds me
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into some weird corner of content but
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these ask me anything episodes I don't
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think fall into that at all in fact I
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think the broad Broad and diverse nature
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of the questions that I've been
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receiving means that there's a little
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bit of everything there's a lot of fun
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stuff there's enough interesting content
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in financial planning and investing in
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personal finance that we're going to
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stay right on theme with these ask me
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anything episodes so again episode 81
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was the first ask me anything episode we
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put out there will be more in the future
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especially with the rate of questions
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that are coming in and you can send
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those to Jesse bestin interest. blog and
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this episode's review of the week comes
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from BH 8489 and this is on Apple
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podcasts where BH wrote in and said
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relatable interesting and informative
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Jesse has a away with words he brings
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complex ideas to life in an interesting
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way for someone like me who usually
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falls asleep at the first mention of
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Finance he balances beginner topics with
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more specific Niche ones we should
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probably all be aware of I'm a big fan
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well BH thank you very much for those
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kind words feel free to drop me an email
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Jesse bestin interest. blog and we'll
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get you hooked up with a nice super soft
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best interest t-shirt now when Andy Hill
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does join us in a few minutes on the
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podcast you'll hear that part of his
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thoughts part of my thoughts on
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parenting have to do with this idea that
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well a there are many things in life
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that matter much more than finances
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including our lovely little children and
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B there are many different seasons of
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life not only in terms of just life as a
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whole but also financially and some
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Seasons allow for more saving and more
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investing while other Seasons less so so
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in that vein I wanted to share some
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thoughts today from some of my previous
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blog posts to act as that reminder the
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reminder that there are many seasons of
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Life the reminder that there are many
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things that matter more than money now
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this first article comes from about two
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years ago exactly June of 2022 I I wrote
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this article right after my bachelor
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party weekend I had High Hopes going
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into my bachelor party they were easily
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exceeded the best part by far was taking
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a step back and watching so many fun
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important people in my life most of whom
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came into the the weekend as strangers
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to each other so easily having a great
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time with one another and for context
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you know this wasn't a a Las Vegas rager
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type party or anything like that we
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rented a house on senal Lake one of the
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Finger Lakes you know very much a lake
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house Vibe with a big backyard lots of
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room for yard games and barbecues and
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hanging out around the fire it it was
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that kind of vibe so very very fun for
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me that's my kind of style after the
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party was over I drove back to Rochester
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giving my friend Rosie a ride cuz Rosie
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flew in from Portland Oregon for the
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party flew across the country and other
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friends flew in from San Francisco they
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drove from Cincinnati New York City
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Pittsburgh all over the place and I was
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thinking Rosie for making that expensive
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and timec consuming journey and he
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responded you just go if you don't make
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time for this stuff it won't happen so
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when someone plans something you just go
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it's how my family has stayed so close
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even though we're all over the country
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you just go you show up Rosie's comment
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made me think of a a famous viral
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article from the website called wait but
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why the article is called the tail end
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and we'll include it in the show notes
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the gist of the article is that your
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remaining time with loved ones is
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deceptively limited and I'll use Rosie
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as an example he and I we met in college
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we used to spend probably 3 hours a day
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together between classes studying meals
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all that stuff for about 180 days a year
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the college year and we only knew each
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other for the kind of the latter 2 and a
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half years of college rough math that's
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1350 hours now he and I have seen each
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other about five times since College
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usually for a nice long week weekend so
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maybe that's a 100 more hours of
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actually hanging out together and
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zooming out to the Future Between
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marriage kids careers the fact that we
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live across the country from one another
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that frequency is unlikely to increase
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he and I might have 10 or 20 more big
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Hangouts ever that weekend we spent
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together in the fingerlakes at my
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bachelor party it could easily represent
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10% of my remaining FaceTime with Rosie
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ever and the same goes for probably 80%
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of the guys at that particular ular
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party my family my childhood friends my
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college friends were all in the last 10%
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or 20% of our time together most likely
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and now as for that entire group ever
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getting together again that's a oneone
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situation those 20 friends of mine
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they'll never all be in that
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circumstance again so I stepped back a
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few times over that weekend to to zoom
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out and to appreciate that your life is
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no different I would contend you're
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probably in the last 10% of time with
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your parents or with your siblings or
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with your cousins or your old friends or
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your grown children your days at least
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the ones you spend with your loved ones
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are numbered and what exactly does this
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have to do with money well money
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ultimately is a tool to buy freedom but
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acquiring money requires us to sacrifice
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our freedom at least in the short run we
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sacrifice now and we hope to reap the
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rewards later balancing that current
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sacrifice against the future reward that
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is vital right that's one of the the
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entire things that we try to focus on
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here on the best interest but also just
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in the whole personal finance financial
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planning investment management realm the
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whole idea is why are we sacrificing
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money now why are we putting it to work
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for the long run why are we thinking
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about 5 years 10 years 20 years from now
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why are we even thinking about those
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topics in the first place the reason why
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is because we want to balance the
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sacrifice now against the future reward
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later if you do it poorly you won't see
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enough of the people you love it's that
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simple and it should be that sobering
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you'll sacrifice too much time now
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because you'll take current abundant
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opportunities for granted or you won't
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have the freedom to see those people
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later when your opportunities are waning
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one of the top regrets of the dying is I
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wish I'd stayed in touch more nobody
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regrets not budgeting nobody regrets a
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missed stock pick they don't measure
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regret in dollars but they do regret not
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having the freedom to be with the people
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they love they measure regret in time
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again they don't measure regret in
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dollars they measure regret in time and
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time is ticking money isn't the end but
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it's the the means that can help you
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reclaim the clock when you get the
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opportunity to see your best friends and
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family you don't want to miss it you
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don't want to miss them you just go so
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that's the first mini lesson today about
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about money not being the biggest of all
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things that other things obviously
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matter more to us the second lesson
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comes from an article I wrote just a
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week or two after that first article
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this one came from late June 2022 and
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the title of this article is a little
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bit self-explanatory it's my parents
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neighbors house caught fire a Financial
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cautionary tale yes my parents
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neighbor's house caught fire in the
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summer of 2022 my mom smelled smoke as
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she was working in the kitchen and my
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dad looked out the window across the
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street and he saw Flames coming out the
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window now that is not good of course
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for many reasons but for one of the
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reasons is that by the time Flames are
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pouring out of the window of a house the
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fire's been going for a little while now
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those neighbors are older they're
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probably in their late '70s they're not
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in very good health and right the fire
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had been clearly burning for a few
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minutes so my dad ran across the Street
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my mom called 911 as my dad arrived the
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older woman The Matriarch neighbor she
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had gotten to the front door from the
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inside of the house but she stopped
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there she couldn't take the step down
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onto the porch without physical
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assistance due to health physical health
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reasons her husband stood behind her
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inside the house and smoke was pouring
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out over their heads now fearing
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flashover my parents stood about 15 ft
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outside and beckoned her to take that
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step take that step down onto the porch
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but she was gripped by fear and
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confusion now if you don't know what
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flashover is really quick aside we'll
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maybe throw a link to a cool video in
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the show notes flashover happens in
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fires especially fires that are
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contained within small spaces like
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inside a room inside a house you know a
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volume with walls and a ceiling and a
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floor around it flashover happens when
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the room is filling up with very hot gas
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as a byproduct of the fire but the flame
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seems relatively contained into maybe
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one corner you don't realize the fact
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that smoke and hot gases are filling up
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the room and eventually there's this
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very quick chemical reaction for lack of
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a better term where a lot of the hot
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gases ignite in a very short amount of
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time and you go from flames in a small
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corner of the room to the entire room is
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on fire and everything inside it is
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burning in a very very short amount of
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time you know mere seconds so anyway
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that's what flashover is it happens in a
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lot of fires if you're curious now
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speaking of other strange definitions
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we're going to talk quickly about time
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dilation time dilation is a well
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documented event that occurs during
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adrenaline rushes right in our human
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monkey brains lizard brains maybe you
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could say my mom said it felt like
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forever as they were standing outside
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the the house pleading with the two
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neighbors to leave the burning house to
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come down on the porch to take that step
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to to to escape and she just it just
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felt like forever well finally whether
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it was 3 seconds or 10 seconds or 30
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seconds nobody really knows enough
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adrenaline and enough heat I suppose
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pushed the neighbor to take that step
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down onto the porch and then a few more
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steps towards the handicap ramp from
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there my parents darted up and grabbed
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her helping her out onto the lawn the
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patriarch he then stumbled out of the
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Smoky doorway under his own power and
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the neighbors suffered some pretty
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severe burns but at least they were
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alive now after a few more agonizing
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minutes or maybe hours who knows with
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time dilation the sirens came from the
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distance firefighters police ambulances
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all rolled in first aid was administered
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and the fire was quickly quenched the
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first response time if you're curious
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cuz this is something that they knew
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from the time of 911 being called to the
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time that the the first ambulances and
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fire trucks arrived it was 8 minutes
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which a kind of shows the strangeness of
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time dilation CU I know my parents said
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certainly didn't feel like 8 minutes
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it's also not bad for Rural America
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because they are out in the countryside
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shout out to volunteer firefighters some
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of you listening might not know this
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some of your local fire departments
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might be well-funded with full-time
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employees full-time firefighters but
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many rural areas have volunteer only
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fire departments where those volunteers
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they carry radio scanners as they go
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about their normal daily lives their
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normal 9 to5 jobs and when a call comes
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they drop what they're doing and they
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respond about 30 different people
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responded to this particular fire some
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coming from as far as 20 mil away that
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is very nice dedication so kudos to the
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volunteer firefighters now this is a
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true story about a real fire but my
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financial mind couldn't help but see
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some powerful money lessons the first
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money lesson is the money in the closet
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lesson
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there's a reason my dad got to the front
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door despite not being inside the
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burning house and despite running 300
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feet or 400 ft across the road there's a
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reason why he got to the front door
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before the neighbors got to their own
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front door they delayed leaving their
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house so they could go retrieve cash
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that was stored in the back of the house
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now I'm not a fire safety expert but
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according to the actual experts one of
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the top four fire safety rules is if a
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fire occurs in your home get out stay
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out and call for help never go back
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inside for anything or anyone that's the
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rule an unburned person without money
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can recover right I I think we all agree
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on that an unburned person without money
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can recover but a lump of fleshy
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charcoal with $1,000 cannot recover
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that's the important lesson but there's
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more to this lesson it's like peeling
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back an onion because some of you are
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thinking well I have $100,000 in my 41k
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and I've got $10,000 in a bank I don't
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really care if $500 or $1,000 burns up
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in a fire well you are in a good spot a
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lot of the the listeners a lot of the
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readers of the best interest are are
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financially literate we in good spots
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but I would bet that these particular
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neighbors they don't have a 401k they
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don't have a bank account and only the
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$500 that they have that's probably the
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only cash they have to their name they
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rely on a monthly social security check
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to pay the bills and that's about it and
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they are living at a pretty low level
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potentially even in poverty you and I
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from our financial positions we might
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not be able to comp apprehend their
00:13:30
desire their need to save that cash when
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I originally shared the story a reader
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wrote in and they kind of said like what
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is going on here just get a fireproof
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safe I get it I have a fireproof safe
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but a fireproof safe costs money these
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neighbors they didn't have any money to
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make matters worse I doubt they had
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homeowners insurance which typically
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covers small cash losses for what it's
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worth they probably distrusted some
00:13:54
institutions like Banks and that played
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an obvious role as well now I don't
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think those are separate issues but
00:14:00
interrelated ones I think that the
00:14:02
positives in life they create compound
00:14:04
magic so it's good parents a good
00:14:06
childhood good schools good college a
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good career a good spouse good friends
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all those things you mix them up in a
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pot and you get some semblance of a good
00:14:15
life but I also think that the negatives
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in life create compound tragedy in many
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cases ignorance poverty broken homes
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those kind of issues they're interwoven
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they're deep-seated and how can they be
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fixed I'm not really sure but it's a sad
00:14:28
State of Affairs and I think that had a
00:14:30
role to play in this situation lesson
00:14:32
number two smoke detectors okay smoke
00:14:34
detectors are a life-saving
00:14:36
riskmanagement tool again I'm not a fire
00:14:38
expert but the rest of the top four fire
00:14:41
safety rules I already read you the
00:14:42
first one the next three are install
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smoke alarms on every level of your home
00:14:47
inside bedrooms and outside sleeping
00:14:48
areas test your smoke alarms every month
00:14:51
if they're not working change the
00:14:52
batteries and lastly talk with all
00:14:54
family members about a fire escape plan
00:14:56
and practice the plan twice a year the
00:14:59
essence of risk management you guys is
00:15:01
that it almost always appears
00:15:02
unnecessary it's a nuisance right why
00:15:05
should I own smoke detectors they're
00:15:07
annoying as hell when I accidentally
00:15:08
burn some toast they cost me $5 a year
00:15:11
in batteries and I've never had to use
00:15:13
them that's the way a lot of people
00:15:14
think about risk management right you
00:15:16
never have to use it it's a waste of
00:15:18
time it's an annoyance well my parents
00:15:20
neighbors did not have smoke detectors
00:15:23
if this fire had happened to start at
00:15:24
night or in an unoccupied room they'd
00:15:27
probably be dead risk and risk
00:15:29
management are essential parts of
00:15:31
investing and money management too in
00:15:33
fact one of my weirdly favorite topics
00:15:35
to write about is the topic of fire
00:15:38
safety and its relationship to investing
00:15:39
in money I wrote an article once we'll
00:15:41
throw it in the show notes called
00:15:42
investing fire alarms or investing fire
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drills that we should run fire drills
00:15:47
for ourself in our investing portfolio
00:15:50
so that we practice what it's like to be
00:15:51
in a scary situation and we make sure
00:15:53
that we don't panic emergency funds
00:15:55
they're risk management an emergency
00:15:57
fund feels wasteful right our cash is
00:15:59
just sitting there and it's losing
00:16:01
ground to inflation that is wasteful
00:16:04
until suddenly you need it and all of a
00:16:06
sudden it's not wasteful in that moment
00:16:08
the waste magically transforms into your
00:16:11
most vital money because it's a liquid
00:16:14
onhand asset that you can spend to save
00:16:16
your butt from something terrible
00:16:18
diversification that's risk management
00:16:19
too it's not fun necessarily to be
00:16:22
Diversified during a S&P 500 or NASDAQ
00:16:25
bull market why am I worried about risk
00:16:27
when every single stock seems to be
00:16:28
going up but the value of risk
00:16:30
management comes into Focus during bare
00:16:32
markets just like it did say in 2022
00:16:34
building risk management into your life
00:16:36
will benefit you in the future right
00:16:38
it's too late to fix the past you either
00:16:40
had risk management that saved you in
00:16:42
the past or you didn't risk management
00:16:45
will benefit you in the future that's
00:16:47
the important thing to remember whether
00:16:48
we're talking about emergency funds
00:16:50
diversification or fire alarms going
00:16:53
back to my imagery I suppose lumps of
00:16:55
charcoal cannot buy smoke detectors and
00:16:59
for the downsides now before it's too
00:17:01
late the third money lesson is about
00:17:03
health back in episode 79 of the best
00:17:05
interest podcast Phil Pearlman joined me
00:17:07
we talked about this idea that yeah sure
00:17:09
money and time are interchangeable
00:17:12
that's often talked about in the world
00:17:13
of personal finance that money and time
00:17:15
have this relationship but actually if
00:17:17
you focus on your health you can buy
00:17:20
yourself or you can earn yourself more
00:17:22
healthy years of your life you can earn
00:17:25
more time through smart Health choices
00:17:28
so in a way Health equals time but we
00:17:30
also said that time equals money so
00:17:32
health and time and money they're all
00:17:34
related we talked about that on episode
00:17:36
79 and there was another amazing Health
00:17:38
lesson from this fire in my parents
00:17:40
neighborhood yes the best interest is
00:17:42
about money but the true end is to live
00:17:45
a happy healthy fruitful life money is
00:17:47
just a tool that helps you along the way
00:17:49
and I found something sad and scary and
00:17:52
cautionary about the neighbor's
00:17:54
inability to physically leave their own
00:17:56
home physically take that step cuz it
00:17:59
was a big step and they didn't have
00:18:00
their wheelchair they didn't have their
00:18:02
Walker take that step from the burning
00:18:04
house down outside onto the non- burning
00:18:07
porch old age will come for us all and
00:18:10
physical deterioration is unavoidable
00:18:12
it's part of that but I pray that my
00:18:15
body will always permit me to escape a
00:18:16
burning building and I hope that the
00:18:18
salads and the the squash matches and
00:18:21
the the semi focus on health I again I
00:18:23
need to get better at it but I hope that
00:18:25
it'll work as intended in the long run
00:18:28
I'm reminded of the Warren Buffett quote
00:18:30
you only get one mind and one body and
00:18:32
it's got to last a lifetime but if you
00:18:34
don't take care of that mind and that
00:18:35
body there'll be a wreck 40 years later
00:18:38
so the lesson the money lesson even
00:18:40
though it's a health lesson is to take
00:18:42
care of your body and your mind so big
00:18:44
shout out to my parents for helping save
00:18:46
two people's lives shout out to the
00:18:47
firefighters the emergency responders
00:18:49
don't forget those four rules of fire
00:18:51
safety everyone here's a quick ad and
00:18:54
then we'll get back to the show serious
00:18:57
question why do podcasters constantly
00:18:59
ask for ratings and reviews yes they do
00:19:02
help highlight our shows to new
00:19:03
listeners they help strangers find us on
00:19:05
Apple podcast and Spotify it's totally
00:19:08
true and a good reason to ask for
00:19:09
ratings and reviews but I have something
00:19:12
more important at least more important
00:19:13
to me I want to know if you like this
00:19:16
stuff I want to know if you like my
00:19:18
podcast episodes my monologues my guests
00:19:20
the information I share with you and the
00:19:22
stories I tell I want to improve and
00:19:24
make your listening more enjoyable in
00:19:26
the process so yeah I would love to read
00:19:28
your reviews and sure if you throw a
00:19:30
rating in there too that's great if you
00:19:33
like what I'm doing please share it with
00:19:34
me it's such a great feeling to read
00:19:36
your feedback I'd love to read your
00:19:39
review or see a rating on Apple podcast
00:19:41
or Spotify thank you and now we're going
00:19:44
to welcome Andy Hill onto the podcast
00:19:46
Andy first joined us on episode 66 a
00:19:49
terrific episode about marriage kids and
00:19:50
money Andy is the awardwinning family
00:19:53
Finance coach behind marriage kids and
00:19:55
money that's Andy's platform which is
00:19:57
dedicated to helping young families
00:19:59
build wealth and happiness Andy's advice
00:20:02
and personal finance experience have
00:20:03
been featured in major media Outlets
00:20:05
like CNBC forbs market watch NBC News
00:20:09
he's had millions of podcast downloads
00:20:11
and video views and Andy's message of
00:20:13
family financial empowerment has
00:20:15
resonated with listeners readers and
00:20:17
viewers all across the world and I
00:20:19
thought Andy would be the perfect person
00:20:20
to ask some questions about the
00:20:22
financial implications of being a new
00:20:24
parent
00:20:29
Andy thanks for joining us and I think
00:20:31
of you you are an absolute expert on
00:20:33
family finances you have a wonderful
00:20:35
young family of your own and here I am
00:20:38
you know when this episode comes out
00:20:39
there's a chance that baby Kramer might
00:20:42
be here I've certainly been thinking
00:20:44
about the finances before this recording
00:20:46
and now more than ever you know what
00:20:48
lies before me so I'm hoping today we
00:20:50
could share some great information we
00:20:52
we'll pull on your expertise for someone
00:20:54
who is either maybe contemplating having
00:20:56
children or pregnant with their first
00:20:58
child or maybe even in those early years
00:21:00
of raising their kids what do you think
00:21:02
about that I love that I mean talk about
00:21:04
the ultimate preparation I applaud you
00:21:06
for that Jesse it's a smart way to be
00:21:08
well thank you much well we'll see how
00:21:09
it works in uh we'll see how it all
00:21:10
plays out in reality I love it but just
00:21:12
thinking of the timeline of having kids
00:21:14
I would wager that I suppose if we
00:21:16
really wanted to get into details we
00:21:18
could even go into like IVF type you
00:21:21
know hey we can't have kids
00:21:22
conversations but I don't and that
00:21:24
affects some people but maybe the place
00:21:26
that everybody gets affected by that we
00:21:28
can start is you're planning for the
00:21:31
birth itself and birth can be pretty
00:21:34
expensive medical expense maybe
00:21:36
insurance is involved or maybe not but
00:21:38
what's your understanding of kind of
00:21:40
birthing costs what kind of questions
00:21:42
should a pregnant person or a pregnant
00:21:44
couple ask when it comes to preparing
00:21:46
for the costs of birth itself I I think
00:21:49
it's a fantastic way to prepare and
00:21:50
obviously it can be a big cost
00:21:53
especially if there's unexpected things
00:21:54
that happen during the pregnancy so like
00:21:57
a lot of things in personal fin it's
00:21:59
always great to be prepared with the
00:22:01
right insurance and hey a cash cushion
00:22:03
as well so if for some reason you had
00:22:06
like a higher deductible plan it's good
00:22:08
to make sure that you can cover that
00:22:09
deductible for anything that might go on
00:22:11
during this time period now that being
00:22:13
said if you are planning to have kids
00:22:15
this would be one of those moments in
00:22:17
time where you're going to probably
00:22:18
incur a lot of cost so if you're looking
00:22:20
and deciding between those two insurance
00:22:22
plans maybe a lower deductible plan
00:22:24
might make sense knowing that what
00:22:25
you've got coming up going on in the
00:22:27
future but have having cash set aside
00:22:29
can help with mitigate a lot of these
00:22:31
things so I know you talk about it a lot
00:22:33
whether that is a three-month emergency
00:22:35
fund or a six-month emergency fund cash
00:22:38
can help with a lot of these
00:22:39
conversations and the great thing about
00:22:41
having cash nowadays is the interest
00:22:43
rates are fantastic on these high yield
00:22:45
savings accounts so it's not really like
00:22:46
you're letting your money sit there do
00:22:48
nothing so you can feel good about
00:22:50
preparing for what's to come with your
00:22:52
family as well as you know you're making
00:22:54
whatever 4% 5% on your money right now
00:22:57
so everybody's winning I this is what
00:22:58
I'm saying Jesse the emergency fund is
00:23:01
huge and I I was thinking as you you you
00:23:03
made me think during your answer Andy
00:23:05
open enrollment for healthcare I want to
00:23:07
say that's Universal and it's usually
00:23:09
you know end of October early November I
00:23:11
think for everybody and I can tell you
00:23:13
for sure it's something that my wife and
00:23:15
I did this past early November is at
00:23:18
that point we we did happen to know
00:23:20
already that that she was pregnant which
00:23:22
is nice but even if not even if we were
00:23:25
thinking okay 2024 is a year we're going
00:23:27
to start trying I sat down and did a
00:23:29
relatively in-depth analysis of here's
00:23:31
the bronze here's the silver here's the
00:23:33
gold here's the Platinum plan here's
00:23:35
what the premium of the plan is here's
00:23:37
the dedu you know here's the deductible
00:23:38
here are the benefits and I would
00:23:40
encourage anyone out there to do that
00:23:42
especially if you know this really
00:23:44
expensive birth and pregnancy is coming
00:23:47
up or might come up next year I think
00:23:49
it's worth taking the time to do that
00:23:50
did you do anything like that when you
00:23:51
guys were pregnant Andy you know when we
00:23:53
were around that time yeah we we did
00:23:55
take a look at those things and lucky
00:23:57
enough if you have these things
00:23:58
happening in your life and you have a a
00:24:00
healthy life you know a high deductible
00:24:02
plan could be great because you don't
00:24:04
need a lot of those expenses but this is
00:24:05
one of those moments where you know
00:24:07
you're going to be relying on the
00:24:08
hospital quite a bit and the costs as
00:24:10
they do continue to rise in those areas
00:24:12
so it's a smart way to go it's something
00:24:14
to investigate and a good way to learn
00:24:16
about more of what the details are with
00:24:18
your health plan anyway especially as
00:24:20
you're deciding where to go what
00:24:22
caretakers you're working with and
00:24:23
making sure your preferred OB Jin is
00:24:26
covered under the plan and things like
00:24:27
that because those are very very
00:24:29
important things I know that was
00:24:30
extremely important for my wife and I
00:24:31
especially after we had number one and
00:24:33
then number two we're like okay we loved
00:24:35
going there we loved meeting with those
00:24:36
docs we want to make sure as we're
00:24:38
switching plans that we still have those
00:24:40
folks covered awesome and now okay let's
00:24:42
say someone they've got a family maybe a
00:24:44
growing family and with a growing family
00:24:47
comes growing need for space so I I
00:24:49
figure some new parents and again we we
00:24:51
were here about a year ago where we
00:24:53
thought to ourselves if we're going to
00:24:55
start a family we probably going to need
00:24:57
a bigger home than we have right now so
00:24:59
it's not even a birth thing it's a real
00:25:00
estate thing but still what are some of
00:25:02
the conversations that you've been
00:25:03
involved in either with listeners of
00:25:05
marriage kids and money or in your own
00:25:07
family and what are some of the problems
00:25:09
or Solutions when it comes to we got to
00:25:12
have that conversation are we in the
00:25:13
right space for our growing family oh
00:25:16
man this is both an emotional decision
00:25:18
as well as a I don't know an important
00:25:20
Financial one as well I think that right
00:25:23
off the bat I think the quick assumption
00:25:25
for a lot of people is more space you
00:25:28
know whether that's a house or a car
00:25:30
before the child even comes into the
00:25:32
conversation or before you're even
00:25:34
pregnant and I think depending on your
00:25:36
situation if you've got the funds to do
00:25:38
it and you can financially do that good
00:25:39
on you like that's great but if you if
00:25:41
this is going to be a stretch for you
00:25:43
financially to upgrade that house maybe
00:25:45
to get that six or seven or 8% mortgage
00:25:47
on the next place so that you're
00:25:49
preparing to you know have the perfect
00:25:52
home know that you being a more
00:25:55
financially comfortable parent is
00:25:58
probably more optimal than that second
00:26:00
or third extra room that you might fill
00:26:03
in the future as your family grows so
00:26:06
there's nothing wrong with expanding and
00:26:08
growing and biggering as we as our
00:26:10
family is bigger but make sure we can
00:26:13
afford it because again that stress
00:26:16
that's something your kids will feel
00:26:18
when you're oh my God I I got to this
00:26:20
job I so stressful I got to pay for this
00:26:22
mortgage it's just killing me like then
00:26:24
the kids might feel bad because of the
00:26:26
situation you're it's it's a big
00:26:28
psychology thing there at that point so
00:26:30
make sure that you can afford it and if
00:26:32
you can't afford it it's okay there's no
00:26:35
childhood trauma if you're staying in a
00:26:37
home that fits a Babys sized person for
00:26:40
so long I my my wife and I started off
00:26:43
in an 1100t Bungalow it was totally fine
00:26:46
for our situation yes we had our
00:26:48
daughter there and she was alive over
00:26:50
the next couple years she lived in this
00:26:51
tiny Bungalow with us and she was fine
00:26:53
cuz she was a baby in a crib and then
00:26:55
eventually yes she started to run around
00:26:57
a little bit bit more we found out we
00:26:59
were pregnant with our our second child
00:27:02
and then the conversations happened like
00:27:03
all right man you're 1100t Bungalow
00:27:06
bachelor pad was fine to begin with now
00:27:09
let's look for the the better School
00:27:10
District the slightly bigger home and
00:27:13
you know much to my suar and I agreed
00:27:14
and we we moved forward from there but I
00:27:16
I guess what I would say just I wouldn't
00:27:17
rush into it just because you're looking
00:27:19
at Instagram or seeing what other people
00:27:21
are doing and saying okay this is a
00:27:23
family home there's no definition of a
00:27:25
family home there's no strict definition
00:27:27
make sure it fits your budget make sure
00:27:29
it fits for your family and it doesn't
00:27:31
overburden your life so you're stuck
00:27:33
with something that impacts your
00:27:36
well-being it's so funny that you
00:27:38
mentioned that that side effect that
00:27:41
maybe some people Overlook that your
00:27:43
children do benefit from having parents
00:27:45
who are not financially burdened who are
00:27:46
not bringing that Financial stress into
00:27:48
the household it's not necessarily what
00:27:50
I was even thinking about talking about
00:27:51
today but it's totally it's got to be
00:27:53
something you talk about a lot on
00:27:54
marriage kids and money and I just had a
00:27:56
conversation maybe 45 minutes before
00:27:59
this recording Andy with a friend of
00:28:01
mine late 30s and a lot of the
00:28:04
discussion was around their emotional
00:28:06
baggage maybe is the right term or
00:28:08
they're what what they're trying to work
00:28:09
through emotionally in their late 30s
00:28:11
based on the household situation during
00:28:13
their childhood where their father came
00:28:16
right out and said you know their F
00:28:17
father was a very uh very very strict
00:28:20
Frugal light about you know the example
00:28:22
that was used was when the strawberries
00:28:24
went bad in the fridge that was a and
00:28:26
that that deserved Maybe not punishment
00:28:28
but there was a reprimand how could you
00:28:30
let the strawberries go bad in the
00:28:31
fridge and part of the function of that
00:28:34
was maybe a little bit of overstretching
00:28:36
financially and then a lost job and then
00:28:40
some challenges at home and it all it it
00:28:42
mixes in a pot and can lead to here we
00:28:44
are 30 years later and it's still on
00:28:47
this person's mind oh no I mean i' I've
00:28:49
heard that too from coaching clients or
00:28:51
friends where what happens with you as a
00:28:54
parent financially your kids are
00:28:57
watching you are their heroes or you're
00:28:59
you're their only source of information
00:29:02
yes eventually they'll get on social
00:29:03
media and get the teenage friends
00:29:05
that'll tell them what's going on but in
00:29:07
the beginning their ideas of what money
00:29:10
means it it's formulated we've seen
00:29:13
studies of this by age seven it's crazy
00:29:16
so those things those memories that's a
00:29:17
core memory of your friend right there
00:29:19
that they're always going to remember
00:29:20
that and depending on how they reacted
00:29:23
to that they either adopted dad's
00:29:25
lifestyle and just said this is the way
00:29:26
or they went completely the oppos said
00:29:28
and said hey Life Is For Living man I am
00:29:30
not talking about Brown bananas or moldy
00:29:33
strawberries like this is I am I'm just
00:29:36
going to YOLO and spend it all hopefully
00:29:38
they found a happy medium you know with
00:29:40
their partner but yeah those things can
00:29:42
really affect us absolutely let's switch
00:29:45
gears let's talk about the two-headed
00:29:47
monster as I think of it have child care
00:29:50
costs and or lost income because I feel
00:29:53
like they're connected at the hip
00:29:55
depending on how a parent or parents
00:29:58
decide to stay at home use Child Care go
00:30:01
back to work it's a deep topic but what
00:30:04
kind of advice can you offer anyone
00:30:06
who's trying to find that right balance
00:30:07
Andy again another emotionally charged
00:30:11
as well as financially charged topic for
00:30:13
my wife and I this was one of those
00:30:14
situations where when we got together
00:30:17
she was excited about moving away from a
00:30:20
career that she really didn't like so
00:30:22
the topic of eventually doing the
00:30:24
stay-at home mom thing was something
00:30:26
that she brought up that she was very
00:30:27
exced about that she wanted to move
00:30:30
forward with so for us this was hey
00:30:32
we're a double inome household right now
00:30:35
what can we do to get used to living on
00:30:37
1.5 incomes so that would move for her
00:30:40
to part-time and then eventually just
00:30:42
one single income so that was a
00:30:44
combination of us reducing our debt so
00:30:47
we had no debt that allowed us to go to
00:30:49
that part-time income for her and then
00:30:51
from there eventually what can we do to
00:30:54
invest so much that we hit coastfire and
00:30:56
eventually pay off our Mor AG okay
00:30:58
that's the second Lover now that she can
00:31:00
go full-time stay-at home mom and she
00:31:02
loved that that was great that was great
00:31:04
for our kids that was great for her I
00:31:06
also worked with a woman at the same
00:31:08
time who said I can't imagine doing what
00:31:10
your wife is doing I'm with my kids for
00:31:13
a certain amount of time and it drives
00:31:14
me bonkers I love my job I love having
00:31:16
autonomy at the office I love going in
00:31:18
and you know working and doing my craft
00:31:21
those are both great Solutions and she
00:31:23
sought out child care to support her
00:31:25
during her career growth so those are
00:31:27
are two I guess opposites of the
00:31:29
spectrum right there and there's no
00:31:31
right answer about what you're supposed
00:31:33
to do really there's no calling that
00:31:35
says you need to be this type of person
00:31:37
you can't be a career woman you only
00:31:39
need to be a mother at home or you
00:31:41
should only be a career woman you
00:31:42
there's no right answer so you have to
00:31:44
decide between you and your partner what
00:31:46
the right thing is for you I love
00:31:48
finding some Middle Ground between these
00:31:50
situations part-time work can be a
00:31:53
fantastic solution for both mothers and
00:31:55
fathers if you can financially afford it
00:31:57
for period of time and with that
00:31:59
affording might be a little scale back
00:32:02
on lifestyle in order to do that if
00:32:05
becoming a parent is so important to you
00:32:07
and you want to spend some more time
00:32:09
with your kids but still keep a little
00:32:11
career you're going to have to sacrifice
00:32:12
somewhere and some of that might be with
00:32:14
entertainment vacations you know all
00:32:16
those extra things that we like to do
00:32:18
when we're in our 20s and we have no
00:32:19
kids and we're dinks and things like
00:32:21
that which is it's great do it you know
00:32:23
do it while you do it while you can cuz
00:32:24
you're going to get tied up pretty soon
00:32:26
with those kids and all all that's ired
00:32:28
with them so I think finding your own
00:32:30
version of the right thing and then
00:32:32
ignoring anything you see online with
00:32:35
that tells you this is prescribed what
00:32:36
you're supposed to do as a father or a
00:32:38
mother is a really smart idea but have
00:32:41
those conversations with your partner
00:32:42
decide what the right thing is we're
00:32:44
moving into a whole new universe of
00:32:46
fatherhood as well which I love that's
00:32:49
talking about how fathers can evolve
00:32:51
from just this bread winner status to
00:32:54
hey I have a big role as a dad too in
00:32:57
raising my my child and coaching up
00:32:59
coaching up my child being there for
00:33:01
them showing what showing them what it
00:33:02
means to be a great dad I'm excited
00:33:05
about what's going on lately with
00:33:06
fatherhood and so I love seeing some
00:33:08
sort of hybrid in this situation that my
00:33:10
wife and I are in right now we like both
00:33:13
versions of working and parenting so we
00:33:15
both through some Financial things we've
00:33:17
been able to do both work part-time and
00:33:19
then we are parents to our kids we're
00:33:22
able to pick them up take them to school
00:33:23
take them to their soccer games I'm a
00:33:25
volunteer soccer coach for my son so
00:33:27
we're trying to ride that line of both
00:33:30
and we really like it so eventually if
00:33:32
you can afford to do that it's not a bad
00:33:33
way to go Andy through through either
00:33:35
your coaching any of the coaching you do
00:33:37
coaching programs or or the education
00:33:39
that you provide or through the podcast
00:33:41
and just I'm thinking of like a podcast
00:33:43
guest have you ever worked someone
00:33:44
through kind of the exercise of what we
00:33:46
just talked about which is a little bit
00:33:48
of hey you Mom and Dad or or dad and dad
00:33:52
mom and Mom whatever you have to decide
00:33:53
for yourselves what you think about this
00:33:55
like what you want to do but then be is
00:33:58
a brass tax Financial part of it which
00:34:00
is well if Mom's salary goes down to
00:34:03
half% and Dad's goes down by 20% and
00:34:07
then child care cost which is huge but
00:34:10
also pretty variable depending on where
00:34:12
you are geographically I mean what are
00:34:14
some of the questions and answers that
00:34:16
parents can be thinking along these
00:34:17
lines yeah I would say yes to all those
00:34:20
things those are the majority of the
00:34:21
conversations because I think a lot of
00:34:23
people want to have that freedom and
00:34:25
autonomy to spend more time taking care
00:34:27
of their heals and be a great parent and
00:34:30
grow a career that they're passionate
00:34:32
about it's like you know it's the the
00:34:33
Instagram dream right but you got to be
00:34:35
able to afford it right so I I've found
00:34:38
that if we're able to do some of these
00:34:39
really smart things with our money in
00:34:42
our 20s and early 30s or whatever before
00:34:45
the time that we become parents we can
00:34:47
check a lot of those important boxes and
00:34:49
make this process a lot easier
00:34:52
eliminating highin debt from your lives
00:34:55
racking up that amount of money for an
00:34:56
emergency fund to take care of
00:34:58
situations that need to happen
00:34:59
beforehand investing early and often if
00:35:03
you get to a point where you've done so
00:35:05
much investing you can you know hit this
00:35:07
status called coastfire you know and
00:35:09
then help you kind of realize oh I can
00:35:11
pair things back a little bit with
00:35:13
regard to my investments so that I don't
00:35:15
have to work as much and if you're able
00:35:17
to reduce your expenses and things like
00:35:19
that the idea of going down to part-time
00:35:21
work can be a lot easier now with regard
00:35:24
to child care and and the cost
00:35:26
associated with that I know you and I
00:35:28
have recently seen some news that is a
00:35:30
it's a staggering stat for a lot of
00:35:33
parents out there and can be just one of
00:35:35
those things where you just want to
00:35:36
throw your hands up in there air and
00:35:37
you're like what can I do we're both
00:35:39
working full-time and child care is
00:35:41
through the roof I do not understand how
00:35:44
parents do this and unfortunately
00:35:46
there's no easy way to slice that it's
00:35:49
these are real costs and the real amount
00:35:51
of inflation that's going up and up and
00:35:52
up every year these are individuals that
00:35:54
work in these organizations and they
00:35:57
need to be paid paid a fair wage in
00:35:58
order to do that and we're taking
00:36:00
advantage of it as parents we had
00:36:01
portions of child care even though my
00:36:02
wife stay at home we did a we did
00:36:04
preschool there was cost to that and I
00:36:06
remember as soon as both of my kids went
00:36:08
to elementary school it was like L
00:36:10
winning the lottery I'm like oh man we
00:36:11
have so much more money back in our
00:36:13
lives so I guess it's a combination of
00:36:16
just remembering that this is a season
00:36:18
in your life if you decide to do the
00:36:19
double income and then Child Care thing
00:36:22
and it's not going to last forever it'll
00:36:24
be tight and it'll require a lot of hard
00:36:27
work if you guys both want to go down
00:36:29
that track but realize it's not forever
00:36:32
and then when you do hit that point
00:36:33
where they're both in uh you know public
00:36:35
school if that's what you guys decide to
00:36:36
do it can be a nice win maybe take that
00:36:39
money and say okay instead of inflating
00:36:41
our lifestyle we can inflate your
00:36:43
lifestyle a little bit but what can we
00:36:45
do to continue to build wealth create
00:36:47
more time freedom for us so we don't get
00:36:48
into this situation again where we're
00:36:50
both having to work super hard and
00:36:53
feeling a little bit tighter so I guess
00:36:54
it's it's a realization that this is a a
00:36:56
period of time the season of Life
00:36:58
analogy is perfect it's something I've
00:37:00
thought about something my wife and I
00:37:02
Kelly and I have spoken about because
00:37:04
we've been relatively Frugal we've been
00:37:07
diligent Savers up until now yeah and we
00:37:10
understand that life is changing and in
00:37:13
the short run maybe we won't be able to
00:37:16
save as much we won't be able to invest
00:37:17
as much in the long run though whether
00:37:20
it's some of those costs Fade Away over
00:37:22
time whether it's our careers continue
00:37:24
to go while certain costs remain fixed
00:37:27
we still think think we're at a very
00:37:28
good spot but part of the reason why we
00:37:30
feel secure in saying that is because of
00:37:33
the 10 years behind us have kind of
00:37:35
paved the way to this point where we can
00:37:38
Co Coast fire is such a good term I
00:37:39
brought it up in a recent episode
00:37:41
because literally you are taking your
00:37:42
foot off the gas a little bit and
00:37:43
choosing to coast and we're at a point
00:37:45
right now where well it's not
00:37:47
necessarily the the option of taking the
00:37:50
foot off the gas there's a specific
00:37:51
reason why we are is because the money's
00:37:53
going somewhere else but when it comes
00:37:55
to that really that that hard driving
00:37:57
savings attitude well we are taking the
00:37:58
foot off the gas there but we think
00:38:00
we're going to be okay if you could look
00:38:02
at your numbers in that fashion and say
00:38:04
well in order to afford more child care
00:38:06
I know I'm supposed to be maxing out my
00:38:08
401k I'm supposed to be maxing out my RO
00:38:11
whatever it's like well for a period of
00:38:13
time you're going to need some of that
00:38:14
money to take care of you today and your
00:38:16
family today so if you can bring that
00:38:18
down a little bit and then maybe kick
00:38:20
back up the savings rate again once
00:38:22
they're in full-time school that's okay
00:38:24
there's no right or wrong answer here
00:38:26
just adjust accordingly in order to make
00:38:29
life more livable here's a quick ad and
00:38:32
then we'll get back to the show one of
00:38:34
the more common questions I hear is
00:38:36
Jesse what do you like and use books
00:38:38
blogs podcasts even Banks and brokerage
00:38:40
firms what are your recommendations so
00:38:44
to answer that question I've put
00:38:45
together a web page you can check it out
00:38:48
at bestin interest. blog
00:38:50
reccommendations again that's bestin
00:38:52
interest. blog reccommendations to check
00:38:56
out how I'm improved ing my financial
00:38:58
life so now Andy the baby is here the
00:39:02
baby is here maybe we're doing Child
00:39:04
Care maybe we are not maybe we're this
00:39:06
is an announcement right Jess the baby
00:39:08
is not here okay good Che just check
00:39:10
here in this convers in this
00:39:12
conversation the bab in the future they
00:39:14
might be right okay all right right and
00:39:15
we need we need well maybe hopefully by
00:39:18
now we hopefully by now we've at least
00:39:19
thought about building that crib or
00:39:21
building that dresser putting the
00:39:23
nursery together but now we've got
00:39:25
diapers the baby's growing we have
00:39:27
clothes there are there's food there's
00:39:30
supplies there's so many little baby
00:39:32
trinkets out there and all this stuff
00:39:34
adds up now a I'm just wondering if from
00:39:38
your experience from your family from
00:39:39
the work you do if you have any thoughts
00:39:41
or tips or tricks but B especially now
00:39:44
with Facebook Marketplace and similar
00:39:45
things like that do you have any like
00:39:47
Frugal tips or any ways where where in
00:39:49
your personal opinion because I want
00:39:51
this to be a personal question where you
00:39:52
guys decided okay for this kind of item
00:39:55
we're going to buy it new but for that
00:39:57
kind of it yeah we don't mind buying
00:39:58
used I think that's a great question yes
00:40:00
we definitely took advantage of uh
00:40:03
Craigslist as well as Facebook
00:40:05
marketplace around this time frame
00:40:07
because some of the super expensive baby
00:40:09
gear it's super expensive so you you
00:40:12
could find people that have gently used
00:40:14
it or had it for a period of time and
00:40:17
sometimes these things are only relevant
00:40:19
for a child's life for like a year you
00:40:21
know like so it didn't even get used
00:40:23
that much now that being said safety
00:40:25
reasons buying used car seats and things
00:40:28
like that is usually not uh advisable
00:40:30
just based on it it could have been in a
00:40:32
crash and and things like that so you
00:40:34
want to make sure that you're buying use
00:40:36
things that are are safe and correct and
00:40:38
things like that but as far as the new
00:40:40
stuff that we went with technology is
00:40:42
fantastic as things go on there are more
00:40:44
and more gadgets to monitor your babies
00:40:47
everything so if you were to buy
00:40:49
something that's 10 years old Tech
00:40:51
versus today Tech I mean I mean I can't
00:40:53
imagine the 2024 baby gear that's out
00:40:55
there right now so I mean you can have a
00:40:57
little bit of fun with that don't go too
00:40:58
wild obviously we can get a little
00:41:00
nervous about every breath and movement
00:41:03
that our child makes and monitoring
00:41:04
every instant of it just know that this
00:41:07
whole like raising humans thing has been
00:41:09
on for a long time before the AI and
00:41:12
Tech that you might be buy with this
00:41:14
gadget so don't kill yourself with
00:41:16
spending overboard a urder for your
00:41:18
child's safety cuz I I'm guaranteeing
00:41:20
I'm seeing the commercials and the
00:41:22
marketing right now you want to protect
00:41:24
your baby right you want them to have
00:41:25
the best life ever buy my $500 Gad right
00:41:27
so it's like just know that you're going
00:41:29
to be okay if you don't have to buy the
00:41:31
$500 thing but yeah if there are some
00:41:33
things you guys want to put on a baby
00:41:35
registry or you know ways to you know to
00:41:38
have a little bit of fun with it you
00:41:39
know I'm thinking of some of the things
00:41:40
that that we bought we ended up buying a
00:41:43
really nice stroller that we ended up
00:41:45
using throughout our babies's life all
00:41:48
the way until they were probably you
00:41:50
know six or seven like it was one of
00:41:52
those things that it transferred from
00:41:54
being a baby stroller also to a walker
00:41:56
to one of those things it's like if you
00:41:58
could have one of these things for a
00:41:59
long time kind of like a you know a car
00:42:02
like hey if if you're going to get some
00:42:03
mileage out of this thing that's okay to
00:42:05
buy the one that you really like that
00:42:07
you have the money for but again make
00:42:09
sure you have actual money to buy it
00:42:12
instead of going into credit card debt
00:42:14
to make sure your child has the best
00:42:15
life or your child is the safest or
00:42:17
whatever you need to have real money to
00:42:19
do that because again you don't want to
00:42:21
get into a point where you're totally
00:42:23
stressed out just trying to raise the
00:42:25
child because again marketing and
00:42:27
advertising have done a very good job in
00:42:29
order to make you feel like if I buy all
00:42:31
these things I'm going to be a better
00:42:32
parent again you can do this for a very
00:42:36
inexpensive amount with used stuff with
00:42:38
hand me- down things from your family
00:42:41
locally I can't tell you how many great
00:42:44
clothes that we got from family that
00:42:46
lives around here cousins and aunts and
00:42:48
uncles that were just handed down reach
00:42:50
out to your network and yes used is okay
00:42:54
and it's not a bad word I just think
00:42:56
Andy of the number of kids in the
00:42:58
neighborhood let's say or just draw 10 m
00:43:00
radius around where you are and there
00:43:02
are so many kids who are 3 or six or 12
00:43:05
or 24 months ahead of where your kid is
00:43:07
yes and you can attest this Andy because
00:43:10
I'm not there yet but most young parents
00:43:12
who I know they look around their house
00:43:13
and they're like all this stuff we just
00:43:15
if someone would just come pick it up
00:43:17
and and help us get rid of it I me we'd
00:43:19
let them have it absolutely absolutely
00:43:21
so there are other parents near you who
00:43:24
are just ahead of you who are probably
00:43:26
willing to part with most of their stuff
00:43:27
for free or pretty low cost and and that
00:43:30
can help you out yes and two points on
00:43:32
that before the child comes I would
00:43:34
highly recommend going through your
00:43:36
house and getting rid of anything that
00:43:38
you don't use anymore because space is
00:43:41
going to be required so if you can sell
00:43:44
things on again Facebook Marketplace
00:43:46
make $500 $1,000 of just stuff that you
00:43:48
have in your house that you don't use
00:43:49
anymore that has value that's great and
00:43:52
then also look into buy nothing groups
00:43:55
as well when you have a child or when
00:43:57
you are wanting to be in a a new
00:43:59
community this is a great way to give
00:44:01
back and say hey I've got 10 onesies
00:44:04
here and they're all and we're done
00:44:06
we're done with onesie time like who
00:44:08
wants them and then you will find
00:44:09
somebody in your community that really
00:44:11
could use that for no money which is
00:44:13
great and then do the same thing for
00:44:15
other things that you might want as a
00:44:16
parent those groups are invaluable it
00:44:19
helps uh decrease consumerism helps
00:44:21
decrease waste of things that we don't
00:44:23
need so those are great options as well
00:44:25
I want to turn to a more serious topic I
00:44:28
think at the very least it's a serious
00:44:29
topic because it does deal with an
00:44:31
unfortunate question which is what if
00:44:33
something happens to one of the parents
00:44:35
and that brings us to kind of a two-fold
00:44:38
question or at least the way I think of
00:44:39
it is a two-fold question and the first
00:44:41
part is how should new parents think
00:44:44
about life insurance in their life and
00:44:46
the second part is should they do
00:44:48
anything on the estate planning front
00:44:50
now that they have children now that
00:44:51
they have these ones these little ones
00:44:53
who they they want to care for many many
00:44:55
decades ahead and if something were to
00:44:56
happen today it could put the family in
00:44:58
in a tough financial situation
00:45:00
absolutely yeah I I think uh it makes
00:45:02
sense for a lot of individuals to have a
00:45:05
will and especially as Life Changes
00:45:07
start to happen in your life this is a
00:45:09
great time to update said will so if you
00:45:12
have a a new individual that needs to be
00:45:13
added to that will and also within a
00:45:16
will you can direct who and how your
00:45:19
child would be taken care of afterward
00:45:21
how those things are taken care it's so
00:45:23
important to do so highly suggest doing
00:45:25
a will depending on your financial
00:45:27
situation a trust could maybe even be
00:45:29
called to order as well and regarding
00:45:31
life insurance yeah I mean it's a sad
00:45:33
subject nobody wants to think about
00:45:35
dying uh nobody wants to think about
00:45:37
that so it never becomes a popular topic
00:45:38
but it's so important so yes term life
00:45:41
insurance is a great way to go great way
00:45:43
to start to go that way you can keep the
00:45:45
costs very low but get a great benefit
00:45:47
for it if you were to pass away and this
00:45:50
is even something that I don't think a
00:45:52
lot of stay-at-home parents take
00:45:53
advantage of but it's also very
00:45:56
important for the state home parent to
00:45:58
have term life insurance as well if your
00:46:00
stay-at-home parent who serves an
00:46:02
important role with raising the child
00:46:06
especially as they get older too taking
00:46:07
them to and from things feeding them
00:46:09
food being there you know being there
00:46:11
for everything that they need if you
00:46:13
were to lose that person you'd be in a
00:46:15
very difficult situation so although
00:46:17
there isn't a salary coming in for that
00:46:19
individual even though it has been
00:46:21
estimated that stay-at home Mom stay-at
00:46:23
home parents should be paid around
00:46:25
$180,000 per year I think by last
00:46:27
estimates based on all the odds and ends
00:46:29
jobs that they do you should have term
00:46:32
life insurance for that individual as
00:46:33
well because yes that would be such a
00:46:35
difficult situation if you were to lose
00:46:37
your parents so again term life
00:46:39
insurance can be very inexpensive can
00:46:41
help you in a situation where the
00:46:43
unexpected happens and unfortunately
00:46:45
I've come across individuals young like
00:46:47
us man that have been in the situation
00:46:49
where it was required a gentleman that I
00:46:52
spoke to uh lost his wife in her 30s and
00:46:56
he was you hardworking guy he was out
00:46:58
there all day long doing all of his work
00:46:59
and then he lost his wife who was at
00:47:01
home taking taking care of their
00:47:02
children and helping to raise them
00:47:04
luckily enough he got term life
00:47:06
insurance and it was a situation where
00:47:08
he was able to use some of the money to
00:47:10
invest and pay off his mortgage and then
00:47:12
he could go down to working part-time
00:47:14
and then be their first 12-year-old
00:47:15
daughter in this extremely difficult
00:47:17
situation that they were in so
00:47:19
preparation is so key when it comes to
00:47:22
this subject yeah it's already hard
00:47:24
enough that the family is having to deal
00:47:26
with the emotional recovery of losing
00:47:30
someone they love so so dearly becomes
00:47:33
even harder if you have to layer on top
00:47:34
of that the fact that now there's this
00:47:36
huge financial problem that the family
00:47:38
is having to dig out from so try as you
00:47:40
might and it's always one of the hard
00:47:41
things I find when talking about
00:47:42
insurance because it almost is like
00:47:44
there's a built-in scare tactic and and
00:47:47
it it kind of sucks but ultimately the
00:47:49
advice of term life insurance which I
00:47:51
heard you say Andy is almost always the
00:47:54
right answer if not always the right
00:47:56
answer I I Suppose there are probably
00:47:57
some Corner cases where maybe someone
00:47:58
could make an argument otherwise I know
00:48:00
here kind of the fiduciary advice is buy
00:48:03
term and invest the difference rather
00:48:05
than ever trying to pursue one of the
00:48:06
other playoffs available but I do have
00:48:08
two what I think maybe are like
00:48:10
practical questions for you either
00:48:12
through your personal experience or just
00:48:13
through what you know when it comes to
00:48:15
term and then also when it comes back to
00:48:17
the will so the first practical question
00:48:19
and maybe I'm I'm committing I think
00:48:20
what is a podcast faux PA which is
00:48:22
asking two questions at once but I'll
00:48:25
I'll remember what they are if we forget
00:48:26
it so the first one is simply how does
00:48:28
someone go about determining the actual
00:48:31
length of their Term Policy in you know
00:48:33
should it be 10 years should it be 30
00:48:34
years but then the second question is
00:48:36
any tips or tricks that you've learned
00:48:39
over your time when it comes to naming
00:48:41
those Guardians in a will about how to
00:48:44
approach the people who you've named as
00:48:46
Guardians because ostensibly you should
00:48:47
let them know that they're Guardians in
00:48:49
your will and it's just any tactics
00:48:51
about how to go about having that
00:48:52
conversation sure yeah I guess uh
00:48:54
depending on when you get term life
00:48:58
insurance just think about what a 10
00:49:01
year 20 year 30-year term might mean in
00:49:04
the future so the goal at least as as I
00:49:07
see it for term life insurance is to
00:49:11
help to cover your income during a loss
00:49:15
especially if somebody relies on your
00:49:17
income so if you are married and your
00:49:21
spouse relies on your income having term
00:49:24
life insurance essentially replicates
00:49:26
you for a period of time until that
00:49:29
transition period happens so does that
00:49:31
need to be permanent does it need to be
00:49:32
your whole life not really it shouldn't
00:49:34
need to if you're married and you have
00:49:37
kids that adds another layer on to it
00:49:40
too okay we're not only do I need to
00:49:42
help out with my salary but we have
00:49:44
children that we're raising for a
00:49:46
certain period of Time how long do I
00:49:47
need to make sure that I've got skin in
00:49:49
the game as a as an income provider even
00:49:52
though I'm even though I might have
00:49:53
passed away for a period of time so for
00:49:55
us we got ours right when we got married
00:49:59
and originally a 20-year term seemed
00:50:01
like a right amount to us at that point
00:50:04
the reason being is we're going to be
00:50:05
raising kids for the next 20 years and
00:50:08
by that point they should be well and
00:50:10
good and gone and hopefully by that
00:50:13
point we're going to be so financially
00:50:15
set that even if I were to pass away my
00:50:18
wife would be able to move on without me
00:50:21
we moved to a 30-year because the price
00:50:23
difference wasn't that different and my
00:50:25
wife kind of liked it you know and that
00:50:26
would led us to our right right to
00:50:29
retirement age essentially where we
00:50:30
would have so much money to be able to
00:50:33
live on at that point so I don't think
00:50:34
it's a right or wrong answer but if
00:50:36
you're raising children you're thinking
00:50:37
that's hey this is going to be a 20-y
00:50:38
year Adventure I think 20 years is is
00:50:41
probably a good place to start and then
00:50:43
just look at the costs associated with
00:50:44
that and then as to your your second
00:50:46
question with regard to having
00:50:48
conversations to who will help take care
00:50:51
of the children on the event of your
00:50:52
tragedy would be honestly just doing
00:50:55
making sure you actually talk to to them
00:50:56
I think that's really the tip yes it's
00:50:58
important to lay that out and it's also
00:51:00
important to have a Frank conversation
00:51:03
with your spouse and your partner about
00:51:05
it although it might be morbid it can be
00:51:07
fun you can have conversations and sit
00:51:09
down and say who's really who really
00:51:11
really want to leave the kids with and
00:51:13
you know what would you want to do in
00:51:15
your situation where you pass away how
00:51:17
do you want your body to be taken care
00:51:19
of what should we do with the kids how
00:51:20
should we leave them the money these are
00:51:22
actually important conversations to have
00:51:25
especially if you're young in your
00:51:26
marriage and you haven't really had some
00:51:28
of these very serious conversations they
00:51:30
could be eye openening you know I
00:51:31
learned a lot about my wife's final
00:51:34
wishes during that conversation I'm like
00:51:36
oh this says a lot about who she is as
00:51:38
an individual this says I mean it was
00:51:40
like one of those moments where I just
00:51:42
like respected her even more it was it's
00:51:44
it can be a deep fun conversation to
00:51:46
have with your partner to learn more
00:51:48
about them I guess fun is probably the
00:51:49
wrong word but interesting that's a
00:51:51
better word I like that tip I again
00:51:54
speaking for myself or speaking uh
00:51:56
selfish if you will but we've started
00:51:58
that conversation and and thought about
00:52:00
people in our life and why or why not
00:52:02
and we tried to make it fun we tried to
00:52:03
make it light cuz it is no one wants to
00:52:05
think about that topic but again you
00:52:07
just don't want to end up in the
00:52:08
situation where what if you never
00:52:10
brought up that topic and something does
00:52:12
happen what if you never bought that
00:52:13
life insurance and something does happen
00:52:15
it is better to rip the Band-Aid off it
00:52:18
is worse to sweep the stuff under the
00:52:20
carpet right we we need to what is it
00:52:22
Daylight is the best disinfectant right
00:52:25
disinfectant there we we'll keep that
00:52:27
flub in there the the listeners can
00:52:29
laugh at that one sunlight is not an
00:52:30
infectant well Andy thank you so much
00:52:32
for sharing again sharing all your
00:52:34
wisdom with us if folks hadn't listened
00:52:36
to you before on episode 66 of the best
00:52:38
interest podcast they can check you out
00:52:40
there but mainly they can go check you
00:52:42
out at marriage kids and money terrific
00:52:44
podcast where can they find that podcast
00:52:47
Andy where can they connect with you how
00:52:49
can they reach out if they're listen to
00:52:50
this fine podcast you can just type in
00:52:52
marriage kids and money wherever you're
00:52:53
listening to your favorite podcast and
00:52:55
you can check out everything we do at
00:52:56
marriage kidss and muddy.com fantastic
00:52:59
Andy Hill of marriage kids and muddy
00:53:01
thanks for stopping by the best interest
00:53:02
podcast thank you Jesse thanks for
00:53:05
tuning in to this episode of the best
00:53:07
interest podcast if you have a question
00:53:09
for Jesse to answer on a future episode
00:53:11
send him an email at Jesse bestter
00:53:14
interest. blog again that's Jesse
00:53:17
bestter interest. blog did you enjoy the
00:53:20
show subscribe rate and review the
00:53:22
podcast wherever you listen this helps
00:53:25
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00:53:27
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00:53:29
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00:53:30
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00:53:35
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00:53:38
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00:53:40
entertainment it should not be taken as
00:53:42
Financial advice and is not prescriptive
00:53:45
of your financial situation