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Family financial planning isn’t just about managing money; it’s also about charting a course toward a secure and fulfilling future for your loved ones. It’s a collaborative process that requires open communication, shared goals and a strategic road map. This comprehensive guide will help you learn the tools to navigate the world of family financial planning, from setting realistic goals to implementing practical strategies for achieving them.
For some, starting a financial plan for their family can be intimidating because they don’t know where to take the first steps. Good news: AAA is here to help you on your family financial planning journey.
A study by financial planning company Empower found that 62% of Americans don’t talk about money. But the cornerstone of any financial plan is setting clear, well-defined goals. Here’s where open communication about money can get you started down the right path.
A family financial planner acts as a trusted adviser, guiding you toward achieving your financial goals. They offer personalized strategies, manage your investments and provide the peace of mind that comes from knowing your financial future is in good hands.
When you are looking for a certified financial planner, prioritize those who have experience working specifically with families. They’ll understand the unique challenges and opportunities that families face and can tailor their approach accordingly.
Remember, finding the right family financial planner is an investment in your future. By following these tips—and reaching out to one of AAA’s knowledgeable family financial planning experts—you will put your financial well-being above all else.
First things first: Start by brainstorming your short-, mid- and long-term financial goals. Short-term goals might include saving for an upcoming family vacation or a down payment on a new family vehicle. Mid-term goals could include funding a college education or home renovations. Long-term goals often mean saving for retirement or creating a legacy financial plan for future generations.
The milestones of a single person are very different from those of a couple or family. Your financial goals may include saving for the down payment for your first house or prioritizing paying off your student loans.
Once you’ve made a comprehensive list of your goals, prioritize them based on importance and urgency. This will help you allocate resources effectively and develop a road map for achieving each goal.
While most people have a desire to take control of their finances, they need an actionable place to start. Here are four tips that can help you create a monthly budget—and actually stick to it for the long term—so that you can accelerate meeting and exceeding your family financial goals.
Take control of your financial future with these financial planning do’s and don’ts.
Learn moreAvoid making a family budget you can’t stick to. It’s important to think about all of your family’s expenses when you’re putting one together. Your mortgage or rent and groceries are common expenses to include in a budget, but also factor in television subscription services, children’s dance lessons or saving for your next family vacation. It’s easy to overlook small costs of everyday family living, but these are the things that will slowly erode your budget.
It's also a good idea to organize a family meeting to discuss financial goals. Involve everyone, even young children, in the budgeting and planning process to foster a sense of ownership and shared responsibility. (Bonus—you’re also teaching great financial literacy to your children at a young age!)
Newlyweds: 6 Tips To Help You Reach Your Financial Goals
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An emergency fund is a bank account with money saved to pay for large, unexpected expenses like unemployment, major home or car repairs, or unforeseen medical expenses. Think of your emergency fund as a buffer that helps keep you financially sound in a time of need and that helps you avoid having to rely on high-interest credit cards or loans.
Most people are confused about how much they should keep in an emergency fund. But the truth is that it depends on your unique financial situation. A good rule of thumb is starting out with three to six months of living expenses in your emergency fund.
While college costs may seem overwhelming, planning and using the right tools can ease the burden:
Quiz: Will These Financial Decisions Improve Your Credit Score?
Learn moreCreating a robust family financial plan goes beyond just the major expenses like mortgage payments and college savings. A comprehensive plan takes into account a variety of other costs that contribute to your overall financial picture. Your recurring monthly expenses form the backbone of your budget. Items like utilities (electricity, water, gas), internet, phone plans, subscriptions (streaming services, gym memberships) and transportation costs should all be included.
Your variable monthly expenses, like groceries, gas for vehicles, dining out, entertainment, personal care items, clothing and pet care will fluctuate from month to month depending on needs and habits. Don’t forget annual and semiannual expenses, such as car insurance, homeowners or renters insurance, property taxes, and subscriptions that renew less frequently. And don’t miss the hidden costs associated with major expenses. For example, for car ownership, consider including the costs of car maintenance or repairs.
Segment your financials for big milestones. Perhaps your financial goals include saving for the down payment on your first house, or perhaps you may want to consider buying your child their first car, paying for their wedding or helping them with a down payment on their first home. These may seem like long-term goals when your children are young, but the years go by quickly—the earlier you start planning and saving, the better.
While having conversations about your end-of-life plan may not be something you look forward to, your family members will be incredibly grateful to know your wishes while you’re still here to tell them.
The first step in end-of-life estate planning should be creating a will. A will is a legal document that coordinates the disbursement of your assets and can appoint guardians for your minor children. It’s recommended that anyone over the age of 18 or who owns property have a will so they can communicate their last wishes clearly.
For families with children, it’s important to discuss who will have legal custody of the children if both parents pass away. This prevents confusion during an already difficult time. If you have life insurance, you should identify the beneficiary of your plan in your will. Life insurance helps you ensure that your spouse and children will be taken care of if something were to happen to you.
Ready to jump-start your bright financial future? Book a meeting with a AAA family financial planner to get on the road to success, no matter where you are in your journey. Through your AAA Membership, you have access to savings tools like special CDs and IRAs that can help you achieve your financial goals.
Talk with AAA’s insurance and banking experts to start your financial planning off on the right foot.
Banking Products are offered by Grasshopper Bank, N.A. Member FDIC Equal Credit Opportunity Lender. Member FDIC logo AAA-Member Verification & Product Eligibility By applying for a AAA Banking deposit account, you acknowledge and agree that if you select a AAA-member product, your AAA membership status with Auto Club Group (ACG) will be validated at the time of account opening and periodically thereafter. If your AAA membership cannot be validated or your membership status changes, your account may be moved to a non-member product with different terms, including but not limited to a lower Annual Percentage Yield (APY) and the removal of other AAA member-only benefits. If this occurs, you will receive a notification regarding the change in the product and applicable terms. If you believe your AAA Membership status was incorrectly validated or that you have been placed in the incorrect product, please contact us to review and correct your status. AAA Cashback Visa Signature® Card is issued by U.S. Bank NA dba ACG Card Services, pursuant to a license from Visa USA Inc. Equal Credit Opportunity Lender Will need L&C final approval.
This information is being provided for general informational purposes only. The Auto Club Group does not assume any liability in connection with providing this information.
Life insurance underwritten and annuities offered by AAA Life Insurance Company, Livonia, Michigan. AAA Life Insurance Company is licensed in all states except NY. CA Certificate of Authority #07861. Products and their features may not be available in all states.
AAA Life and its agents do not provide legal, financial, or tax advice. Therefore, you may wish to consult independent professional advice prior to the purchase of any contract.
This is a summary of product provisions and does not contain all of the benefits and exclusions. For complete terms of the insurance coverage or annuity, please contact your agent or refer to the policy/contract.
Annuities - LA
Annuities are not short-term products. During the surrender charge period, withdrawals exceeding 10% will be subject to a surrender charge that may be higher than fees associated with other types of financial products and may reduce principal. Withdrawals prior to 59½ may be subject to IRS penalties, separate from the annuity’s schedule of surrender charges.
EliteGuarantee Deferred Annuity - LAEG Contract Form Series: ICC11-4101/DA-4101 (In OR: ICC11-4101)
Platinum Bonus Annuity - LAPB Contract Form Series: ICC11-4111/DA-4111 (In OR: ICC11-4111)
Guaranteed Income Annuity - LAGI Contract Form Series: ICC14-4120/SPIA-4120 (In OR: ICC14-4120)
The payout amount you will receive is based on your individual circumstances, the options you select at the time of application and your initial premium payment.
Term Life Insurance - LT
Premiums are guaranteed. They are level for the premium period and increase annually thereafter. Any sample premiums are examples only and may vary based on your personal health history and underwriting guidelines. The answers provided to the health questions are used to determine eligibility for coverage. Not all applicants will qualify. Product and its features may not be available in all states. Coverage ends at age 95.
If insured is diagnosed with a terminal illness that will cause death in 12 mos. or less, up to 50% of the total benefit can be applied for, and used as insured chooses. The remaining benefit payable at death will be reduced by the Accelerated Death Benefit paid and any accrued and unpaid interest (8% annual interest rate applies). Receipt of Accelerated Death Benefits may affect eligibility for public assistance programs and may be taxable. Please consult the appropriate social service agency and seek the advice of tax counsel before applying for these funds. The Accelerated Death Benefit is not available if the terminal illness results from an intentionally self-inflicted injury. This benefit may not be available in all states.
Traditional Term - LTT Policy Form Series: ICC19-1801/1801 (In OR: ICC19-1801)
Group Direct Term Policy Form Series: GT8200
Individual Direct Term Policy Form Series: ICC16-1501
Universal Life Insurance – LULG
Health history, underwriting guidelines and the answers provided to health questions are used to determine approval for coverage. Not all applicants will qualify. Rates may vary.
Lifetime Universal Life Insurance - LUL Health history, underwriting guidelines and the answers provided to health questions are used to determine approval for coverage. Not all applicants will qualify. Rates may vary.
Policy Form Series: ICC19-4701/4701 (In OR: ICC19-4701)
If insured is diagnosed with a terminal illness that will cause death in 12 mos. or less, up to 50% of the total benefit can be applied for, and used as insured chooses. The remaining benefit payable at death will be reduced by the Accelerated Death Benefit paid and any accrued and unpaid interest (7% annual interest rate applies). Receipt of Accelerated Death Benefits may affect eligibility for public assistance programs and may be taxable. Please consult the appropriate social service agency and seek the advice of tax counsel before applying for these funds. The Accelerated Death Benefit is not available if the terminal illness results from an intentionally self-inflicted injury. This benefit may not be available in all states.
Accumulator Universal Life Insurance - LULA Health history, underwriting guidelines and the answers provided to health questions are used to determine approval for coverage. Not all applicants will qualify. Rates may vary.
Policy Form Series: ICC19-3701/3701 (In OR: ICC19-3701)
If insured is diagnosed with a terminal illness that will cause death in 12 mos. or less, up to 50% of the total benefit can be applied for, and used as insured chooses. The remaining benefit payable at death will be reduced by the Accelerated Death Benefit paid and any accrued and unpaid interest (5% annual interest rate applies). Receipt of Accelerated Death Benefits may affect eligibility for public assistance programs and may be taxable. Please consult the appropriate social service agency and seek the advice of tax counsel before applying for these funds. The Accelerated Death Benefit is not available if the terminal illness results from an intentionally self-inflicted injury. This benefit may not be available in all states.
Whole Life Insurance
Whole Life Insurance (for coverage amounts of $30,000 or more) - LWL Policy Form Series: ICC18-5601/5601 (In OR: ICC18-5601)
Health history, underwriting guidelines and the answers provided to health questions are used to determine approval for coverage. Not all applicants will qualify. Rates may vary.
If insured is diagnosed with a terminal illness that will cause death in 12 mos. or less, up to 50% of the total benefit can be applied for, and used as insured chooses. The remaining benefit payable at death will be reduced by the Accelerated Death Benefit paid and any accrued and unpaid interest (8% annual interest rate applies). Receipt of Accelerated Death Benefits may affect eligibility for public assistance programs and may be taxable. Please consult the appropriate social service agency and seek the advice of tax counsel before applying for these funds. The Accelerated Death Benefit is not available if the terminal illness results from an intentionally self-inflicted injury. This benefit may not be available in all states.
Rapid Issue Whole Life Insurance (for coverage amounts of $25,000 or less) - LRIWL Policy Form Series ICC20-7001/7001 (In OR: ICC20-7001)
Responses to the application will be used to determine approval for coverage. Not all applicants will qualify.
This Whole Life policy is referred to as graded benefit whole life insurance. If you suffer a non-accidental death within the first two years of coverage, your beneficiaries will get 100% of the base premiums you paid, plus 35%. After two years, the total amount of your coverage is paid for death due to any cause.
After the first two years of coverage, if insured is diagnosed with a terminal illness that will cause death in 12 mos. or less, up to 50% of the total benefit can be applied for, and used as insured chooses. The remaining benefit payable at death will be reduced by the Accelerated Death Benefit paid and any accrued and unpaid interest (8% annual interest rate applies). Receipt of Accelerated Death Benefits may affect eligibility for public assistance programs and may be taxable. Please consult the appropriate social service agency and seek the advice of tax counsel before applying for these funds. The Accelerated Death Benefit is not available if the terminal illness results from an intentionally self-inflicted injury. This benefit may not be available in all states.
Guaranteed Issue Whole Life Insurance - LGIWL Policy Form Series: ICC16-6301/GWL6301 (In OR: ICC16-6301)
The maximum amount of Guaranteed Issue Whole Life insurance coverage per insured is $25,000.00. Subject to age requirements and policy limit restrictions.
This Guaranteed Issue Whole Life policy is referred to as graded benefit whole life insurance. If you suffer a non-accidental death within the first two years of coverage, your beneficiaries will get 100% of the level monthly premiums you paid, plus 30%. After two years, the total amount of your coverage is paid for death due to any cause.
If you are a California resident 65 years of age or older, we are required to advise you of the following. The sale or liquidation of any stock, bond, IRA, certificate of deposit, mutual fund, annuity, or other asset to fund the purchase of this product may have tax consequences, early withdrawal penalties, or other costs or penalties as a result of the sale or liquidation. You may wish to consult independent legal or financial advice before selling or liquidating any assets and prior to the purchase of any life or annuity products being solicited, offered for sale, or sold.
