The cycle of life is an incredible journey through good times, bad times and unexpected events. Preparing for one’s financial lifecycle is often miscalculated, leaving a person or family financially strapped or in dire straits. 

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Many life events bring us joy: a wedding, the birth of a child, a graduation and so on. But when a good event happens, such as the birth of a child, unexpected expenses may arise. For example, the baby may need extra care or need to be in intensive care for a while.  Although insurance helps, there are many out-of-pocket expenses for which the parents will be responsible.  Additionally, if the mother was planning to nurse and can’t, the cost of formula could strain the pocketbook. Not to mention, the impulse buying of all the cute little clothes for the infant. 

If one is expecting a child, a separate “baby fund” is a way to mitigate the unexpected. If it’s not needed, that fund could be set aside for future funding of the child’s needs or wants such as piano lessons or gymnastics.  In addition, it could be added to your regular emergency fund or invested in the child’s future education.  

No one wants to prepare for the bad, such as the death of a loved one. We may have planned and prepaid for some of the arrangements, but if the event comes sooner than expected, one is stuck scrambling and may be at the mercy of the funeral home to help make arrangements. This emotional event can lead to overpaying for plots, funeral services, flowers, transportation and carrying out the wishes of the deceased. 

Even when simple arrangements for burial or cremation have been prepaid, other costs may have been overlooked, such as celebration of life expenses (venue, food and drinks, helping out-of-town relatives with accommodations, etc.) which can quickly deplete any savings or emergency fund. This is a tough situation to navigate. Going in debt for this situation may leave family members bitter and unwilling to help, therefore jeopardizing current relationships. If possible, keep it simple. Your loved one would not want to see you suffer financially to provide them a grand sendoff nor severe family relationships over it. If you are inclined to use a credit card for the event, then tackle that debt as soon as possible. Use it as a learning experience and beef up your savings or set up a separate savings for your services and final wishes.

The addition and passing of loved ones should be expected, but can often come with unexpected circumstances. Proper financial planning can help ensure the most positive outcomes.

In honor of my first-born grandson Mykolas, and in memory of my dear aunt Marie.

Michele Sarna is a certified financial planner with Beacon Pointe Advisors and can be reached at (760) 932.0930 or [email protected].

Provided as information only and should not be considered investment, tax, or legal advice or a recommendation to buy or sell any type of investments. Asset allocation, portfolio diversification, and risk strategies cannot assure or guarantee better performance and cannot eliminate the risk of investment losses. Form ADV contains important information about Beacon Pointe Advisors, LLC, and may be viewed at:

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