I Went To A Financial Planner. They Helped Me Plan For The Horses, Too.
By Dani Neumann
If myself and my circle of horse friends are indicative of a larger trend: many horse people don’t tend to plan financially far into the future.
At least, my close circle didn’t financial plan until we decide to “adult” (a little, not too heavily) in our thirties. I’ve wanted to speak to a financial planner for years but was afraid they would look at my horse habits and tell me I wasn’t making smart choices. My husband and I finally reached out and what we learned blew our minds.
We are all set up with a retirement fund in addition to disability and life insurance. I wanted to drop this bomb here: it didn’t hurt. Like, at all…and I feel as if we finally have peace of mind. I even still have my farm with no judgment from our advisor. These options can be set up for any budget! The best part? All of this advice was free in the hopes that we opened an account with their company. Yes, real financial planning advice from professionals is free—and the policies are affordable.
Disability Insurance
If we get injured, who will cover our personal needs and the four-legged family? Disability insurance will, and we could have worked it into our monthly bills even before I had a “real” job. We chose to be covered through age 70. The caveat for this affordable peace of mind is that a lot of things will disqualify you.
You have to have a squeaky clean health history (hard for a lot of horse people to achieve). I qualified, so I signed up as quickly as I could. If you are in your twenties and have rock-solid health, I cannot stress this enough: look into disability insurance now. I’ve watched co-workers struggle with diseases such as M.S. and worry about their horses, their grocery bills, and their medical bills when they lost their ability to perform at work. It was heartbreaking. Private disability coverage is affordable and provides you with so much security. Get this while you’re young and/or healthy!
Life Insurance
There are two choices: term and whole. Our advisor likened “term” life insurance to renting a policy. Term life insurance is super cheap, but at the end of the policy, you have no savings to draw from. Your coverage simply ends. However, if you die prematurely, term life insurance can make sure your zoo (and humans you care about, too) are released from the stress of financial woes while they mourn you.
For $1.2 million in coverage, for example, the cost was $63 a month. Whole life insurance is what rocked our world. It was likened to a mortgage. You pay your monthly fee, which is much higher than the term fee, but it builds up into an account that you own. Whole life insurance accounts grow over time at a set rate. The number at the end of the projections our financial advisor provided is seriously high. Life-changing, retirement-changing high. You can draw from it like a normal retirement account, as well, and pay yourself back.
The catch is how much more expensive whole life insurance is. Most people do a mix of coverage that includes term and whole options. This is where my advice on life insurance stops—talk to your financial advisor about how to make this work for your budget. If you don’t have obligations like a mortgage or family to support, you could get a small life insurance policy to care for your animals in the event of your death. In tandem with a will, your animals will be set for life.
Retirement Savings
Don’t forget to set up a 401k as well, while you’re at it. I won’t go into detail here as it’s easy to research and your financial planner of choice can advise you as to which model you should invest in.
I also encourage you to talk to close friends and family about money. It’s still taboo in our society to talk about income and finances in real dollars, but we need to open up and help each other learn when we can.