Barefoot Investor: How to live fearlessly in 2019

Christmas may be over … but it’s not too late to give your kids and family a gift that will last through 2019. All you need is a couple of hours to spare and a fireproof, waterproof safe, writes the Barefoot Investor.

Christmas may be over … but it’s not too late to give your kids a gift that will last through 2019.

My new book, The Barefoot Investor for Families, is a road map for raising hard-working, generous and financially confident kids — and over the next few weeks I’m sharing a couple of extracts that will help you do just that.

INS AND OUTS OF LIFE INSURANCE IN SUPER FUNDS

ESTATE PLANNING IS VITAL FOR COUPLES

MORE BAREFOOT INVESTOR

But before we focus on your kids … I want to help you get a head start on the new year by focusing on you.

So today I’ve prepared a very special excerpt that will give you and your kids the confidence to live fearlessly in 2019. In fact, this may be one of the most important things you ever do for your family …

Your Legacy

Most of us want to protect our children from the tough times they’ll face throughout their lives.

Well, now you’re going to put something in place to protect them from the toughest time of all.

I’ve shared this plan with literally thousands of people — and they all say that it changed their life.

I call it the Fearless Folder, and it’s the final way you’ll say “I love you”.

I can’t control when I die, but the one thing I can control is having everything sorted and prepared for my family.

The Fearless Folder

I face death — through the eyes of people who contact me — almost every week.

See, I’m the guy who many parents write to when they get bad news … and it is absolutely heartbreaking.

They all say the same thing: that they never thought it would happen to them.

At moments like these I think about my own family, and how they’d go through it without me.

It’s too painful to think about.

This fear rattled around in my brain for years, until I had this realisation:

I can’t control when I die, but the one thing I can control is having everything sorted and prepared for my family.

Imagine this

Stop for a minute.

Read the next few lines slowly and play along with me:

I want you to think about your family.

It’s two weeks after your funeral. Everyone has moved on … except them.

Everything’s a mess.

They have no idea if you had a will.

They have no idea what you wanted for your funeral.

Each day brings another frustrating conversation with another frustrating bureaucrat who gives them a frustratingly long list of things they have to do to administer your financial affairs.

None of it makes any sense!

They slump into a cold, lonely bed at night, exhausted and overwhelmed.

They grab their phones and flick on Facebook … and your face beams back at them. They can’t work out how to shut down your profile and delete all the random posts and chatter from weirdos who barely even knew you. It’s just another painful reminder of the never-ending list of things they have to get sorted.

They’re at the lowest point in their life … and their grief is being compounded because they have to deal with all this … crap.

Now, listen up: I’ve seen this happen in real life, over and over again.

I’ve helped too many distraught, overwhelmed widows, and widowers, fumble through the financial fog.

This situation is actually normal.

Now, imagine this

In retrospect, your decision to “run with the bulls” in Spain when you had a pulled hammy wasn’t one of your smartest ideas.

And stopping for a selfie when the bull was right behind you … well, that was just kinda dumb.

But, hey, we all gotta go sometime, right?

Your partner back home in Australia is devastated.

She walks to your study, grabs a key from the top of your bookshelf and unlocks your fireproof, waterproof safe.

As she opens the safe she sees a folder. The cover reads:

Fearless Folder — Everything in One Place — Jim Smith

She takes the folder out of the safe, sits down and opens it. The first page reads:

I love you.

I love you so much that I’ve prepared this folder for you.

It has everything you need to manage my passing.

As she reads through the Fearless Folder she feels a wave of relief wash over her … everything really is there.

You’ve included the contact details of people you’ve hand-picked to help her.

You’ve attached your will and documents allocating your power of attorney and your ‘medical attorney’.

You’ve written out a statement of your net worth — a handy guide to make sure all the assets are accounted for.

You’ve detailed all your bank accounts, investments and insurance policies, and all the login details.

You’ve included the password to your email (which you funnel all your day-to-day receipts through), so she can log in and find all your household bills.

There’s the password for your Facebook and social media accounts, so they can be memorialised straight away.

Your partner turns the next page, and stops. She can’t believe it. You’ve actually taken the time to write down specific answers to the questions that are now swirling around in her head: whether you want your organs donated, any specific funeral instructions, and more.

And then she turns to the final page and reads your final message … and bursts into tears.

This is the power of the Fearless Folder. And this is what we’re going to do right now … in three simple steps:

Step 1: Collect your important documents.

Step 2: Invest in a fireproof, waterproof safe.

Step 3: Write your last letter.

Let’s do this.

 

The first step in creating your fearless folder is to gather your most important documents.

                  

STEP 1: COLLECT YOUR IMPORTANT DOCUMENTS

“Collect your important documents” sounds like something your mother would say, right? Relax … I’ve created an idiot-simple checklist, and you’ll be able to get most it done in a night.

Go to barefootinvestor.com/resources to download your Fearless Folder checklist.

Pro tip: Rather than manually printing out all your statements, there’s a simpler way: from this day forth, change all your bills to be delivered via email. This way, you just need to leave your executor (and your loved ones) access to your email address — and they’ll have all your latest bills.

  

A fireproof, waterproof safe is the best place to store your fearless folder.

                  

STEP 2: INVEST IN A FIREPROOF, WATERPROOF SAFE

Where do you store your Fearless Folder (and any other important documents)?

Some people suggest leaving your will on the kitchen table when you go on holiday … just to be extra cautious.

Clearly, you don’t want to go on holidays with anyone who does this. Seriously, they’re the sort of people who travel to New Zealand and hide their traveller’s cheques in a bum bag.

Instead, what I want you to do is go to Bunnings and buy a First Alert Fire Safe and Waterproof Protection Chest. At the time of writing it costs $69.

What I like about these chests (other than the fact that they’re fireproof and waterproof) is that they’re small enough for you to pick up by the handle if you have to evacuate your home.

Here’s the thing: we lost everything when our house burned to the ground … except our important documents. Having all those made the process of rebuilding our financial lives that much easier.

So here’s what I want you to do this weekend:

First, go to Bunnings and shell out the $69.

Second, place your Fearless Folder inside the safe, along with your passport and other important documents (see checklist opposite).

Third, choose your own super-safe spot that you’ll quickly be able to grab it if you have to evacuate.

Finally, and this is important, give your executor the spare key that comes with your chest.

That way your executor (or your backup executor, who doesn’t live with you) knows you have a Fearless Folder, and they also have a key to eventually open it.

      

The final step is to write a letter to your family and loved ones.

              

STEP 3: WRITE YOUR LAST LETTER

The last step of all is to write your last letter to your family.

I’ve shared this with thousands of people, and they say it’s one of those moments in life when you actually take stock of what’s really important.

Picture your loved ones opening the safe and reading your letter — because one day they will.

Write with your heart.

Write like it matters — because it does.

Then, print it out and put it on the top of your Fearless Folder. And as you lock your Fearless Folder into your safe, and put it away … you can breathe a sigh of relief.

The Barefoot Investor For Families, by Scott Pape, is published by HarperCollins Australia and available now.

Originally published as Barefoot Investor: How to live fearlessly in 2019