Today is Fathers Day. Father’s Day is a celebration honoring fathers and celebrating fatherhood, paternal bonds, and the influence of fathers in society. (Wikipedia) It is also a good time for fathers to consider the critical role they play in the family, to take stock and to carefully consider their responsibilities by implementing important financial steps to secure their families. Here are a few things to note:
Have money conversations with your spouse
Money woes are a leading cause of fractured relationships and divorce. Keeping financial problems to yourself makes things worse and damages the fabric and stability of your relationship. Discuss any worries with your spouse as sharing the burden eases it. If you have loads of money and you hide it away from your spouse, leaving her completely in the dark, this will only breed mistrust and put a strain on your relationship.
In the traditional African society, men were generally regarded as breadwinners and women stayed home with the children and were looked after by the men in their families. Yet slowly, but steadily, the economic and cultural climate has changed and many women earn more than their spouses; indeed in many cases they are the primary breadwinners. How does this affect relationships?
Philip, 40, is a partner at a small law firm that he co-founded. His wife is an investment banker; she earns twice his income. For a long time Philip was embarrassed that his wife was footing most of the major family bills including rent and school fees. It was his ego he confessed. “I just felt inadequate even though I know it was baseless.”
Things came to a head and it was important to have a conversation regarding the salary differences and the toll it was having on their relationship largely due to his feelings of inadequacy and not her stepping into the role of “head of household.”
The conversation changed everything as they both expressed their feelings and addressed the issue of how the income differential was affecting them. It gave them both some re-assurance; he was able to address his feelings of inadequacy, whilst she felt relieved of her feelings of guilt for her success, as they planned together as a team for the benefit of their family.
Establish an emergency fund
Your emergency fund should have enough cash to cover at least six months of living expenses. If you can’t achieve that just yet, start small but meticulously each month as soon as your salary is credited, have a certain sum set aside towards saving and investing. Automating your savings is the most convenient way of achieving this. No job is secure; many are losing their jobs. An emergency fund helps to tide you over difficult periods and cushions the impact.
Save for your children’s education
For the vast majority of people, funding your children’s education ranks as one of the largest expenses you will ever face and it must thus be carefully planned for. Thinking about your young children’s future education may seem like a lifetime away. However, with the rising costs of education, if sound investments are not made now, covering the huge expenses for the secondary and postsecondary years may be a challenge. When your children are still young, you have the benefit of time to select investments that offer the prospect of higher returns over the long term. It takes discipline, consistency and sacrifice to amass the money that you need to educate them and give them the best chances in life.
Review your insurance
Life insurance is a must for dads. We tend to assume that bad things won’t happen to us and far too many people ignore the need for insurance until a major mishap or setback occurs; it is then that the impact of inadequate insurance coverage becomes glaring. No matter how meticulous you are with your finances, failure to purchase adequate insurance can impair your financial future and put you and your loved ones in a desperate situation in an instant. Motor vehicle, household, health and life insurance, are just a few of the various policies that are available to protect you and your family.
Put an estate plan in place
Many people assume that if they pass on, their spouse will automatically become beneficiary to their estate. If you were to die intestate, that is, without leaving a will, your property will not simply pass to your spouse as you might think; strict rules rank your next of kin, and your property will be distributed according to laws of intestacy, which may vary from state to state.
It is only by having a clear estate planning mechanism in place, that you can protect your immediate family, including your wife and children, and ensure that your investments and property and other assets do not go into the wrong hands in the event of your untimely passing. Review and update your will, trust and other estate planning documents periodically, say once a year, to ensure that they are in accordance with your current status and intentions; you might have had more children or wished to include additional beneficiaries, may have acquired additional assets or disposed of some.
Who is your next of kin?
At some time or the other, you have probably had to fill out a form or some other documentation where you had to clearly state your next of kin. Many people don’t take this designation that seriously and sometimes even forget whom they designated as time goes by. In Western society it is usual for a man to name his spouse as his next of kin. In Africa it is quite common for his brother to be named as next of kin. This puts his immediate family, that is, his wife and children in a precarious situation. Ideally the mother of your children should be the obvious choice.
Designate a guardian for your children
Considering the worst-case scenario is something that no one likes to think about. But if something were to happen to both you and your spouse, you do want to be sure that your children will be well taken care of. Some couples disagree about who would play that role; should it be his brother or her sister or a friend perhaps? If you haven’t made your wishes clear, the court will appoint someone without any guidance from you; it may be someone that you do not want to raise your children. You would have considered several factors including where the guardians live, their financial situation, how many children they have, the way their children are being raised and so on. Sit down with your spouse, to discuss the pros and cons of various options and come to a decision and include this in your will.
Give your family the gift of your time
Many fathers do not make time for their children. In the final analysis, it is not all about money; all the money in the world cannot replace that precious time for bonding, building and nurturing relationships with your children.
Happy Fathers Day!
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