How to Be a Battle Buddy to Your Family

This is a guest post by Jeff Rose. Jeff Rose is an Illinois Certified Financial Planner(TM) and co-founder of Alliance Investment Planning Group. He is also the author of Good Financial Cents, a financial planning and investment blog and his currently working on his first book entitled Soldier of Finance. You can see more about his mission at the same titled blog Soldier of Finance.com.

Welcome to one of my video blogs from SoldierOfFinance.com. First, I want to thank Jeremy for allowing me to share this video (and text) with you. Today I am going to be talking about the “battle buddy” concept. If you caught my last video (you can see the post and video here: Finding Your True Battle Buddy to Combat Your Financial Demons) , it explained what a battle buddy is. Today I want to expand upon the battle buddy concept, how I am a battle buddy to my family, and how you could and should be a battle buddy to your family, too.


What is a Battle Buddy?

Once again the battle buddy concept – a battle buddy was introduced to me in Basic Training. This was the guy who knew everything about me through the whole Basic Training process. We carried each other through it. That was the foundation of the Army, and as I went through my Army training and my Army career, every soldier I served with was my battle buddy. They were the ones who were there with me to support me no matter what and I knew always had my back.

When I apply the battle buddy concept to my home life, right now my battle buddies are my family members. They are there for me, and I am there for them. We are there to support each other, to make it through thick and thin, to make it through the good times, through the bad times, and everything in between. So, how am I a battle buddy to my family? And how can you be a battle buddy to your family, especially when it comes to your financial life? Let’s take a look.

Buy Life Insurance

The first thing I can say is buy life insurance. If you have watched some of my videos, if you have read some of my blog posts, you are probably thinking, “Jeff, shut up about life insurance already!” The only reason I keep bringing it up is because I see a lot of people who either:

A) Do not have any life insurance at all; or
B) They do not have nearly as much life insurance as they should.

For most of the people who do not have enough, it is because they just do not get it; they do not know how much they really need. I run into a lot of younger families, and they will have purchased say $50,000 of life insurance or $100,000 of life insurance, and I cannot stress enough how little that is to really take care of your loved ones if you are gone.

I am going to have a blog post on this, but for me when I first bought my first term life policy, it was just me and my wife (we did not have any kids yet), and I purchased $250,000 of life insurance. That was the number that made sense for me and my family. When I was deployed to Iraq, we had the SGLI which was life insurance for the military. They capped us out at $400,000, and that was a no brainer. For maybe $10 or $15 a month, I wanted to make sure that my wife was taken care of after I was gone. After we had our son, I bought a second term policy. I kept the original $250, but I bought a second one, and that second amount was $500,000. So, after our first child, I upped my life insurance to where I had about $750,000 of life insurance.

That might sound like a lot of money, but when we ran the numbers, I wanted to make sure that she and my son were taken care of if something happened to me. That was my main priority.

Once we had our second son, I was 30 years of age, and I knew that I did not want to go through the whole life insurance process again, so I bought an additional $1.5 million of term life. I kept the original 2 policies, so right now I am paying on 3 policies for a total of $2.25 million of life insurance. That might seem like a lot, but for what I pay on an annual basis, to me it is totally worth it knowing that my family is taken care of. I will go into more specifics as far as how I came up with that amount; there will be future videos and blog posts to support that, but that is where I am at right now. I do not envision ever needing any more life insurance than that. That may change, but as of right now that is where we are going to be.

How much life insurance do you need to buy? I addressed the topic on my blog where I looked at a possible scenario at how much term life insurance one may need to buy. Jeremy also had a good article on the topic that asked: how much life insurance does one need?

Don’t Forget About Disability Insurance

Another way that you can be a battle buddy to your family, as I am to my family right now, is purchase a disability insurance policy. This is something that initially I had written off for several years. I just did not see the value in it. It was very expensive (so I thought), so I just completely passed on it. I will say that I was very fortunate that my current investment firm gave us a pretty good deal to where I have a handsome monthly benefit.

Right now I can get $4000 a month if I were to become permanently or even temporarily disabled. When I started just looking at the numbers and looking at the statistics as far as the likelihood of me being disabled versus actually passing away, the stats were compelling as to the more likelihood of being disabled versus actually being deceased. Like I said, I did not jump on it initially. If you are one of those who thinking, “Gosh I have to pay for life insurance; I have to pay for my health insurance; I have to pay for my car insurance and my homeowner’s insurance; and now you are telling me to buy disability insurance too?”, you cannot deny the numbers.

Maybe you do not need as high a monthly benefit. Maybe you can survive not having that disability insurance kick in as quickly. They have an elimination period; mine is 90 days, meaning that it is going to take 3 months before I receive my first payment. Maybe you could stretch yours out longer so it does not cost as much. To extend it out means you had better have a pretty substantial emergency fund. Those are the things which I have talked a lot about in the book and you will see more about. So, that is just another way you can be a battle buddy to your family, making sure you have a decent amount of disability insurance to take care of you for the what ifs and the just in cases.

Communication and Verification

Another thing to consider that I have done as a battle buddy for myself and for my family is (this is kind of a mixture of things) have that conversation where everyone knows where all the important documents are. Documents can be passports, your birth certificates, military documents, anything pertaining to a business you own like I do. Make certain you and your spouse know where everything is. Part of that is having that conversation, and part of that is having the physical eyes on, knowing, “Ok, I know where that is, or I know where this is.”

Typically you see this when you have had a parent deceased, especially if it was expected, to where now you have to go through the estate and try to find everything. I am fortunate in that I have not been through that, but I have held a lot of my clients’ hands through that whole process. I can think of one case where the son did not know anything about his parents’ finances or anything that was going on. When they unexpectedly passed away, I cannot even explain how much of a nightmare it was as he had to go through files, mounds of paperwork, cabinets, and safes trying to hunt everything down. It literally was a 9 month process just to get an initial handle on the whole situation. Do not do that to your family! Be a battle buddy to your family and make sure they know what is going on and where to find important financial documents. I cannot stress that enough!

Check Your Beneficiaries Now

A final thing that I will say, which is kind of about documentation, is if you have a spouse and/or children and if you have retirement accounts whether they be a 401K at work or a pension or IRAs held at a brokerage account (this can also apply to life insurance policies), make sure that your beneficiaries are updated. I cannot emphasize that enough, especially if you have a new spouse.

A lot of times what you will see is someone who is newly married, if they had a retirement plan before they got married, they usually listed one of their parents as the beneficiary. Then they get married, and they just forget about it. Several years go by, and then all of a sudden something happens, and instead of having the spouse as their primary beneficiary, it is still the parent. I have seen this happen firsthand. You know that that husband wanted that money to go to his wife. That is why he married her. That is why he took the vow and stood in front of the church to say his vows to his loved one, but in this one case he forgot. The money went to his parents, and they did not share any of that money with the spouse. I could not believe it! It just floored me! If he were a battle buddy to his spouse, he would have checked and verified that she was the primary beneficiary, and that never would have been an issue. That is how he could have been a battle buddy to his family.

So, these are just a few things to consider. I just want to share some of the ways that I feel I am being a battle buddy to my family and asking you how can you be a better battle buddy to your family. Those are just a few tips. This is Jeff Rose, SoldierOfFinance.com.

In what ways have you been a battle buddy to your family?

For more information visit SoldierOfFinance.com. These opinions are for general information only and are not intended to provide specific advice for any individual. To determine what may be appropriate for you, consult your financial professional prior to investing. Securities offered through LPL Financial, member FINRA, SIPC.

Jeff Rose is an independent financial advisor who loves Crossfit workouts and craves In-N-Out burger.  You can follow his updates on Twitter: @jjeffrose.

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