There is a favorite story that Financial Planners will use to show Breadwinners the importance of Income Protection or Whole Life Protection and that will be the story of the Goose that lay the Golden Eggs.
The Background Of The Story And What You Can Relate From It In Today’s Reality
In brief and in comparison to today’s context, this story shares that there is this Special Goose (in comparison, will be similar to a Breadwinner who maintain and sustain a family and reproducing future generation) that lays a Golden Egg each day (in comparison to the Children, who is the future pillar of of the society).
This Golden Egg, in the story, has actually made the owner very rich as the owner can sell the eggs for very good profit. Thus in reality, Children are good and valuable resources to the society as they can contribute their talents and services back.
This Golden Egg also has the potential to become another Special Goose that can lay a Golden Egg. Imagine having two Special Goose producing double the Golden Eggs now. Can you see the benefits in translation to having a Breadwinner, continuing to contribute to the family and society and having the future generation to contribute as well?
The story went on that because of Greed and Foolishness, the owners wanted to become rich faster and eventually killed Special Goose, thinking that they can get all the golden eggs out for a faster profit. They realize that they were totally wrong and thus lost their current and future income stream – The Special Goose that Continue To lay the Golden Egg!
In Relation To A Proper Financial Planning
I get to see many clients who have just started their own family and I can totally agree that Children are very important and precious, especially if the child is the first-borned!
so when it comes to Financial Planning, most of these family-oriented Clients, that I have talked to, would rather start off their planning with the Child in mind, and thus forgetting the importance of their financial and emotional position in the family.
If something unforeseen should happen to these Clients, seriously, their family and even the new-borne will be affected – emotionally and financially!
But do you know that, in today’s context, should anything happen to the first-borne, these clients are affected emotionally and financially as well!
Talk about mixed feelings!
The Two Different Sides Of Financial Planning
The Proper Side
A proper Financial Planning would agree that the Client (the Special Goose) should be protected well enough in areas of Health, Critical Illness and Income Protection Insurance. Only after, should the Client concentrate on protecting the Children and the rest of the family.
In simple and logical sense, would be that should anything happen to the Client, he is protected financially by the insurance coverage and emotionally the rest of the family will not be that affected as they can be sure, at least, the Client has enough funds for medical treatment. Or to the extreme circumstance (death), the insurance claims can help to make sure that the current family lifestyle can still be maintained in the absence of the Client.
What is being discussed above is totally agreeable in a financial planning sense. But do look around you and you will agree that there is another side to it!
The Mixed Feelings Side
Many, may include you as well, are busy with work or even be making ends meet. To seriously have a Child (out of willingness or accidentally) and especially having the first child, and not to talk about having the second, involve many considerations like:
- Financially: Will your current income (including your spouse’s) be able to take care of the child and last through to the independent age? Will you have enough for a possible Second?
- Health: Work Stress has caused many to have long term illnesses like depression and such. Will this, coupled with long term medical costs, be able to ensure that you are able to take care of your child. Can your health give you a possible Second?
- Time: Most people are spending more time at work than at home with their family. Whatever spare time that’s being used for the family, is most of the time, to show to the child that the parents are still there once in a while… So do you think you have enough time for the possible Second?
Just the above few considerations, most Clients that I know of, choose to have just one Child (one and only Golden Egg) and a least possibility of a Second. Thus when it comes to Financial Planning, it just seem so fair that this only Child be given the best financial plans and whatever is left of the budget will then be considered for the Client.
Thus the mixed feeling is that, most of these Clients spend a lot of their available budget on this only Child. To them, this only Child is like their Special Goose (which can be their only) and vice versa. So you understand the irony and mixed feelings here?
So… How Then?
In actual financial planning, it all depends on your priority and needs. I can follow the books to advice you that you need to protect yourself first before your child but if this child is your first and the last, it do make sense that your efforts on this child is well protected as well! Whatever the case, is, as long as you can understand what you are doing, whatever you decided to plan with will serve you well. The only worst case is that you do not plan for yourself or your child!