Legal & Financial Info

Legal & Financial Info

Creating a Will

When you’re young and in good health it’s easy to have the mindset that death is far away, especially since the subject is considered a bit morbid and taboo in our society. But it’s never too early to prepare, especially if you have family depending on you.

A will is just the tip of the iceberg for legal documents, so we’ve detailed a few others you may want to keep in mind as well.

  • Last Will And Testament
    Legalzoom provides a step by step guide on how to write your last will, including the cost.
  • Living Will
    A written statement detailing a person's desires regarding their medical treatment in circumstances in which they are no longer able to express informed consent, especially an advance directive.
  • Power of Attorney
    The authority to act for another person in specified or all legal or financial matters.
  • Revocable Living Trust
    A trust whereby provisions can be altered or canceled dependent on the grantor. During the life of the trust, income earned is distributed to the grantor, and only after death does property transfer to the beneficiaries.
  • Home Transfer Deed
    Document (instrument) by which ownership of a registered property (such as land or securities) is conveyed from its seller to its buyer.


Buying Life Insurance

Similar to creating a will, life insurance acts as a support for loved ones after you pass. While a will focuses on how to divide up your assets, life insurance focuses on providing financial aid to your family in the short term.

We have included the details of the different types of life insurance below. However, before making a decision you should consider speaking further with a professional.

Term insurance is just as it sounds. Life insurance is paid only if death occurs during the term of the policy. Terms are usually anywhere from 1 to 30 years. Within term life insurance, there are two types.

  • Level Term - death benefit stays the same throughout the life of the policy
  • Decreasing Term - death benefit decreases over the course of the policy

Whole Life/Permanent
Unlike term, whole life insurance will be paid no matter how long you live. This means you can live past 100 and your family will still receive benefits! There are 3 types of whole life/permanent life insurance.

  • Traditional Whole Life - comes with a death benefit along with a savings account. You agree to pay a certain amount in premiums on a regular basis for a specific death benefit, and the savings account grows based on dividends the company pays to you.
  • Universal Life - similar to Traditional Whole Life, but with more flexibility when it comes to using the savings. After money has accumulated in your account, you will also have the option of altering your premium payments. However, if you stop or reduce your premiums and the savings gets used up, the policy might lapse, at which point coverage will end.
  • Variable Life - Similar to Traditional Whole Life, but the savings can be invested in stocks, bonds, and money market mutual funds. This allows for quicker growth, but also exposes you to more risk. Some policies guarantee that your death benefit will not fall below certain amounts, so make sure to research carefully if going for this option.

Financial Goals

Creating and sticking to financial goals is an intimidating step for many. It takes a bit of work, but following the steps listed below will ensure you succeed in the short and long term.

If at any point during this process you are feeling stuck or just unsure of your ability, do not give up! Some people may find doing all these steps on their own is easy, but this is not true for everyone. There are a lot of financial professionals who can help, and even online communities more than willing to help. For example, the personal finance community on Reddit is a great place to get additional suggestions along the way through these steps.

  1. Short, Mid, and Long Term Goals

The most important step is to determine what is important for each of these stages.

  • Short-term generally refers to a period of less than 1 year. Perhaps purchasing a new car, or saving for a dream vacation.
  • Mid-term generally refers to a period between 1-5 years. Perhaps quitting work and going back to school, or purchasing a home.
  • Long-Term generally refers to a period up to 10 years and beyond. Perhaps retirement or college savings.

The most crucial aspect of creating goals for each term is to understand what truly matters to you. When you look back at your past self from the future, what things and experiences do you want to look back with?

The number of goals and what make up those goals are completely individual, so take some time to discuss with your partner and/or family to decide what makes sense for you.

  1. Determine Money Needed and Priority Level

Creating goals is arguably the most fun part, and important. You’ll want to research how much money each goal will cost, which might make it a little tedious, but it’s worth it to keep it real.

In addition to determining total amount needed, it is important to prioritize each goal. This will help make decisions more clear if your financial situation ever changes and you need to make some cuts to your budget.

  1. Review Your Finances and Create a Budget

When reviewing your finances and setting up a budget, the main metric to look for is net income. This is the total money you make after all taxes and deductions from your paycheck (also known as take home pay). If you’re a freelancer or 1099 worker, it is best to be a bit conservative when estimating net income, since you won't know exactly how much you owe.

After you know your net income it’s important to review past expenses to help create a realistic budget. We have a thorough breakdown of how exactly to map out your budget below.

  1. Automate Money Tracking and Budget

For most, a simple money tracking system will work perfectly fine. If you want to take a more active role in managing your budget, check our section below for free templates and advice on staying on top of your budget.

Apps and Software to Automate Money Tracking

There are a lots of money tracking and budgeting site options available that allow you to connect your accounts (bank, credit card, etc.); here are a few:

Mint is the industry standard when it comes to tracking and categorizing expenses, and will even send notifications if you are going over budget in any one area. They focus on people just starting out with personal finance tracking, so if you are a beginner, this is a great place to start.

Personal Capital is similar to Mint, but with more of a focus on investing and retirement planning. This can be very helpful if our goals are more focused on saving long term.

LearnVest is not quite as powerful as Mint, but some find the layout and functionality easier and more intuitive than Mint.

You Need a Budget is easy to use and offers free, live, online workshops.

  1. Periodically Review Your Goals

It can be very easy to get caught up in the day to day things that life throws at you. For help staying on track, set periodic reviews depending on the timeline of your goals.

For instance, a goal with an end date of less than 1 year may need to be checked once a month or more. A long term goal with an end date years in the future may be better suited for quarterly reviews.

Creating and Sticking To a Budget

As mentioned above, there are a number of apps that help in tracking money, which includes creating a budget. For those not confident in their ability, or who simply don't have the time to map their finances out via spreadsheet, apps such as Mint can be a great start. But if you want to manage your finances manually, there is no better option than traditional spreadsheet software like Excel or Google Sheets.

Excel has the benefit of being the most powerful and widely used spreadsheet software on the market. If you use Excel, make sure to have backups of your work, since it is not automatically saved in the cloud.  A particularly powerful and helpful family budget spreadsheet template would be this one.

Cutting Out Unnecessary Expenses

One thing many people discover when creating a budget for the first time, is just how much money is spent on frivolous things. There is nothing quite like seeing your spending habits laid out in front of you to help get your budget under control.

We've provided some common expenses which can be cut. If you are in a unique financial position, there is always help through forums such as, /r/personalfinance.


  • Meal Planning
  • Take Your Lunch to Work
  • Start A Garden

Restructure Debt

  • Consolidate Loans
  • Balance Transfer
  • Refinance


  • Eating Out drains the wallet
  • Cancel Gym Memberships
  • Eliminate Your Cable Bill
  • Cancel Subscriptions

Other Options

  • Reduce Cell Phone Bill
  • Cut Back on Clothing
  • Reduce Consumable Habits (Smoking, Drinking, etc)
  • Move To A New Location

A helpful strategy if you're wanting to get really frugal: When creating a budget, calculate the number of hours of work it will take to earn certain items.

Example for Salary Pay

Let's say Jack makes $50,000 a year before taxes, which translates to $1575 every paycheck, after taxes. He wants to know how many hours of work it takes to pay for his family cell phone bill, which is $160/month.

If Jack works 40 hours/week, he can figure out how long it will take to earn the money to pay for the cell phone bill by using the method below:

By dividing the total paycheck by the hours it took to earn that paycheck, we can convert the salary into an hourly rate. (Note: This is the hourly rate AFTER TAXES, not the rate of the full salary.) From there, we can divide the cell phone bill by the hourly rate, which gives us 8.13, meaning it will take slightly more than 1 day of work to pay for the cell bill.

Jack is not likely to completely remove cell phones from his budget, but he will likely be more inclined to find cheaper phones and plans for his family.

Example for Hourly Pay

Let's say Jake makes $15 an hour before taxes, which translates to $1,020 every paycheck, after taxes. He wants to know how many hours of work it takes to pay for his weekly bar tab when he goes out with friends. Jake usually gets 2 beers and some appetizers, which averages around $45 per outing.

If Jake work 40 hours/week, he can figure out how long it will take him to earn the money for the bar tab using the method below:

By dividing the total paycheck by the hours it took to earn that paycheck, we can find the true hourly rate. (Note: this is the hourly rate AFTER TAXES, not the full rate.) From there, we divide the bar tab by the hourly rate, which gives us 3.53. Since this is a reoccurring event, we can find the monthly rate by multiplying the answer by 4.

Jake is certainly not going to stop hanging out with friends, but he will likely be more inclined to reduce his average consumption.

Investment/Saving Accounts

 Pay yourself first! This is the #1 rule with financial planning professionals. We all make sure that we are able to pay our various bills and costs of living. Whether that be housing, groceries, internet, car, or any of the many other expenses we incur day to day; these expenses get paid.

It seems the last person that most of us think about is ourselves. Admittedly, it may be due to the feeling that putting yourself first is a selfish thought. This is an important hurdle to overcome.

Your goals are important and should be treated as such!

Various Investment & Savings Accounts


  • 401 (k)
  • IRAs
  • Thrift Savings Plan

 College Fund

  • 529 College Savings
  • Prepaid Tuition Account
  • Education Savings Account (ESA)

Rainy Day Funds

Most financial advisors will recommend 3-6 months worth of savings. Having this savings means your family could survive for 3-6 months without 1 or both incomes. This is especially important today when fewer people are working full careers with a single company.

With less job security comes more worry over finances. Giving your family a 3-6 month buffer on living expenses will take a lot of worry off your shoulders.

 Funds vs Individual Securities
Most financial advisors would recommend selecting a fund (index, mutual fund, ETF) when investing, as opposed to selecting individual stocks/securities. Considering many "experts" can't pick a winning stock portfolio, it is best to spread your risk over the entire market.

As this article from Investopedia points out, diversifying your investments is the best safety net against an erratic market. While this can be accomplished by picking individual securities yourself, funds and indexes are the easiest way to get started.

Base Camp © 2019 Boot Camp for New Dads
All Rights Reserved

Pin It on Pinterest