I started watching Breaking Bad a while back (I know I’m late to the party). If you’re not familiar with the show, Walter White (the main character) is in his early-to-mid forties. Happily married with a teenage boy and a baby girl on the way.
Walter, a high school science teacher, is diagnosed with lung cancer. Doctors give him a short time to live. Between medical bills and the loss of his future income, Walter has no idea how he will provide for his family when he’s gone. This leads him to the wild idea of making meth with a former student, Jesse Pinkman.
His hopes are that he will be able to make enough quick cash to put away for his family.
As you watch the show, it may seem far fetched to be in a situation like Walter White’s. However, Breaking Bad and your future have more in common than you think.
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The Plot Thickens
Fast forward to Season 2, Episode 1. Walter and his partner in crime, Jesse, finish collecting on a drug deal in a salvage yard. They get in the car to leave. Walter sitting in the passenger seat holding a bag full of money. Clearly shook up from seeing this drug dealer beat one of his own. He starts nervously mumbling the following:
Adjusting for inflation. Good state college, adjusting for inflation, say $45,000 a year. Two kids, four years of college, $360,000. Remaining mortgage on the home, $107,000. Home equity line, $30,000. That’s $137,000. Cost of living, food, clothing, utilities, say two grand a month, and that should put a dent in it, anyway. 4k per year. Provide for say, 10 years, That’s $240,000. Plus 360, plus 1, 3, 7. $737,000. That’s what I need. That is what I need. You and I both clear about 70 grand a week, that’s only 10 1/2 more weeks. Call it 11. 11 more drug deals. And always in a public place from now on. It’s do-able. Definitely do-able.
Asking the Hard Questions
How would you react if you were given a diagnosis like Walter White?
How would you react if you were diagnosed with a life threatening illness and realized you had no idea how your family would financially keep going?
The story above is probably a bit far-fetched, but when you’re under that much stress you’re not yourself. It’s hard to predict how you would react in that situation.
READ MORE: Term Life Insurance vs Whole Life
Where to Start
Where do you start when thinking about your family’s future? How do you prepare for the sudden and unexpected?
As strange as it may sound, there are things you need to think about to get your house in order.
- How will your children be cared for?
- Would your family have to downsize to something more affordable?
- How will debts be paid for?
Using the acronym L-I-F-E we can determine what it would take to alleviate financial stress from your family in a difficult time.
Don’t spend too much time thinking. Write down the first numbers that come to mind.
L-iabilities
What do you owe money on? Do you have a car loan, student loans, a mortgage, credit cards? Add up everything you owe money on. Now write that number down.
Unfortunately, you will still owe money on these things if your spouse is not around.
I-ncome
How many years will you rely on your spouse’s income? 5 years? 10 years? Until he/she retires?
Let’s say you’re 30 years old, you have 2 kids, and a mortgage. Would you need your spouse’s income 35 more years (i.e. until the age of 65)?
Whatever number you came up with, write it down next to I.
F-inal Expenses
How much will a funeral and everything that goes into one cost? Write that number down.
E-verything Else
Do you want to leave money for your child’s future education? Maybe a charity? Make a note of the total for Everything Else.
Breaking Bad and Your Future
Add up the four numbers you just came up with from the acronym L-I-F-E. This is a good estimate of how much life insurance may be best suited for your needs.
If Walter White from Breaking Bad would have purchased an adequate amount of life insurance he wouldn’t have been in a financial crisis.
It’s time to quit dragging your feet. Sit down and make a plan. Find a life insurance professional you can trust. Someone that will put your needs first.
Your future doesn’t need to look like the show Breaking Bad. You have choices.
Black and white Featured Image photo credit: timsnell via photopin cc
