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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: SomedayStache on June 12, 2015, 11:23:34 AM

Title: Time to be a grown up. But what is the proper order of operations?
Post by: SomedayStache on June 12, 2015, 11:23:34 AM
Hi all,

I've decided its time to fully accept adulthood.  It's probably far past time for me to get disability insurance, my spouse and I to set up a will/power of attorney/etc, and we also want to save a 3 month efund.

We can't do all these at once.  My question is what order I should fund this stuff? I have an extra $1000 per month to play with.


Background: Single income family.  Federal employee.  Because the federal employee sick leave policy is 'so generous' there is no short or long term disability insurance through work.  But 3 maternity leaves in the past few years mean I have very little sick leave in the bank.   My husbands earning potential is about 1/4 of mine - therefore he stays home with the kiddos (there are 3 kids all under the age of 7).  If I were unable to work we'd be floundering.  All of these things seem important to me.

Advice?
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: Chrissy on June 12, 2015, 11:45:53 AM
#1  E-Fund.  All of your goals are about protecting your family if something happens to you.  This is the first order of business because they would be without your salary and need to cover your funeral and other expenses until your husband could claim your Social Security benefits for the kids.  If you don't know what your family would receive, find out.  (6 months)

#2  Financial Documents.  Do your research on what you really need in your state.  I agree with your cost estimate.  (8 months)

#3  Disability Insurance.  (9 months)

Really won't take you that long to accomplish all of these.
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: lakemom on June 12, 2015, 12:14:57 PM
You already have 10X your income in life insurance?  And at least enough to pay for childcare for a decade on your spouse?  If not I'd prioritize that ahead of the other options.  Then do:  1. legal work (what if one/both of you died while saving up an efund?) 2. efund 3. disability insurance.
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: SomedayStache on June 12, 2015, 12:28:09 PM
Yes - I do have appropriate life insurance (privately purchased).  My spouse also has life insurance at a lower amount but appropriate to pay for childcare/college costs for the kids.
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: TaxChick on June 12, 2015, 12:35:32 PM

  • The financial documents cost will be maybe around $1000? $1500?  No idea how much, but this seems to be the right ballpark.e?
Does either of your workplaces have a group legal service benefit such as Hyatt or Metlife? At my work I can enroll in this during open enrollment time. It cost me about $240 for a year. But I was able to have my will and trust documents prepared, including a special needs trust without any additional cost.
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: Catbert on June 12, 2015, 12:45:09 PM
Of those 3 priorities I would save disability insurance until last.  The chance of you becoming disabled in the next year (while you work on the other issues) is pretty small  If you were injured/disabled on the job the Fed has a very generous worker's comp program.  Many Federal agencies have leave donation programs.  Some are leave banks where workers (often with use-or-lose annual leave they can't use) donate into a general fund.  Other times it's a direct donation of leave to a particular worker.  While not a substitute for stockpiling some of your leave for the future, it can help out in a pinch.
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: KittyFooFoo on June 12, 2015, 02:41:02 PM
PEMDAS
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: SomedayStache on June 13, 2015, 07:56:28 AM
PEMDAS
?

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Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: amyable on June 13, 2015, 07:58:27 AM
PEMDAS

I love you.
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: SomedayStache on June 13, 2015, 08:03:31 AM
PEMDAS!  Now I remember.

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Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: regulator on June 13, 2015, 08:07:36 AM
Of course your first step should be to join the Society: https://www.societyofgrownups.com/
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: marty998 on June 13, 2015, 04:54:03 PM
Never heard of PEMDAS before but I like it... I was always taught BODMAS - Brackets, Orders, Division, Multiplication, Addition and Subtraction.

(Orders are powers and roots)

PEMDAS!  Now I remember.

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Advertising of products is supposed to be banned lol. Phone brands and t-p-t-lk get way too much free press here.
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: SomedayStache on June 13, 2015, 06:51:15 PM
Mite grumpy today hmm?
But your comment did get me to go delete the signature that was added by default after the t a talk update.
Title: Re: Time to be a grown up. But what is the proper order of operations?
Post by: arebelspy on June 14, 2015, 12:35:36 AM
Assuming your jobs are stable, I'd probably spend 3 months upping the emergency fund from one month to two months while researching the other two options, then knock out those smaller ones, which should only take a month of savings each.  Then finish off the emergency fund.  But really, there's not a wrong choice, you're saving a decent amount and doing important things, and they're all useful and need to be done, so do whatever you decide makes you feel most uncomfortable right now not having done.