Planning for a Worst Case Scenario: A Gift to Family0
We all have our blind spots, and parents are not an exception. As a native Californian, I acknowledge that I have a high capacity for living in denial of certain things—a blind spot when it comes to thinking about earthquakes, for example. Too often, financial planning, estate planning and life insurance are similarly ignored and unconsciously put into our blind spots too. The idea that dealing with these things forces us to confront– of disaster, of tragedy, of suddenly becoming separated from our children– is just too painful and scary to contemplate.
In a recent New York Times article titled Money Admonitions, Kenneth R. Feinberg writes, “I was astounded to learn that over half the victims of the Sept. 11 attacks had no life insurance. Were it not for the 9/11 fund, such a grievous oversight would have placed many victims’ families at financial risk.” As the former administrator of the September 11 Victim Compensation Fund of 2001 and current administrator of the General Motors ignition-switch compensation program, Kenneth R. Feinberg has had the “unenviable task of putting a value to the lives of people who are already dead.” His experience is eye-opening. Called in after 9/11, the shootings at Virginia Tech, the Boston Marathon Bombings, and the General Motors ignition switch failures, he was tasked with figuring out how to compensate those left behind for what an individual lost in a tragedy would have earned over a lifetime. And these are the good stories in one respect; in these cases there where funds to take care of the people left behind in the wake of a large, national tragedy.
What about the small, everyday tragedies that touch thousands of lives everyday in our country? The car accidents? The sudden heart attacks? There are people left behind in these everyday tragedies too. Feinberg has seen more than his fair share of what happens when people who are young and in good health do not plan for the future of their families. “When angry siblings, parents and relatives declare(d) war with one another over the victim’s assets…”
In his article, Feinberg explains how seeing these situations close-up gave him the impetus to get his own financial life in order:
- “I made sure that my wife and three children had a clear understanding of who gets what…. I also bought substantial additional life insurance. I bought a mix of term and whole life insurance, because I wanted short-term protection in the event of my untimely death and a long-term investment vehicle.”
Feinberg’s experience trained him to confront his blind spot. By doing this, he took care of his family and the people he cares about.
There is no doubt that it is unpleasant to think about painful things, especially things that might be painful for our children. It is human nature to put them off, ignore, or even deny that they are a possibility. The truth is, however, that facing this pain could save our families an even greater pain. In the event of a worst case scenario– a parent’s untimely death– children and remaining relatives have a lot to deal with. They will be grieving a loss and scrambling to pay for and take care of life’s most basic needs. Financial and estate planning clarity is a gift and proof of a deep and responsible love, a message that even in death, the parent wants to take care of his or her family.
We can all learn something from Feinberg’s experience with tragedy. Perhaps it can give us the courage to face our blind spots, to pick up the phone to call a financial planner, and to do the work we need to do to really take care of our children in the moment when they will need it the most.