One of the topics our clients frequently raise is how financially challenging life has become for young families. They could be coming out of school, maybe recently married. They’re trying to buy a house, you’ve got some debt, and then maybe kids come along.
So, the question becomes: how do you help them get started while instilling healthy responsibility? We love this topic because we see the healthy desire to be generous without undermining good financial life lessons that early family life is supposed to teach you.
Today, we’re looking at a few of the key decisions we encourage young families to focus on to help get their financial future off to a strong start.
1. Start With What’s Automatic: Your 401(k)
The first thing I always encourage clients to do is review their company’s 401(k) and get involved. This is one of the simplest ways to get momentum because it creates automated savings every month without even thinking about it.
I’m a huge believer in automation; anything good you can automate in your financial life, do it. Repeat, repeat, repeat. Compounding interest is the eighth wonder of the world. That’s what we need to be sticking to.
If you are comfortable, I have encouraged our older clients in the past to show portions of their portfolios to their kids to better emphasize the value of consistent investing over time. Some people may be anxious to share those kinds of numbers, but I think pairing them with honest stories about getting started might make all the difference.
Young families need the conviction that this is a priority in a season of life when finances might be tighter. Building a system that runs in the background is one of the best ways to stay consistent.
2. Don’t Skip the “In-Between” Goals
Second to that is starting to understand the more intermediate-term goals they have—and how they’re saving alongside for them. A lot of families feel like they’re stuck between big categories:
- Retirement feels far away (it is)
- Day-to-day expenses feel more urgent
- And everything in the middle gets fuzzy
The “in-between” goals are real, and they matter. These are things like moving to the next house, launching a new business, or eventual college savings. Every family’s circumstances are different but I think having clear conversations helps put some frameworks in place for what’s needed if they want to hit certain milestones along the way. Thinking about them clearly helps you make better decisions with your cash flow and gives you direction beyond just getting through the month.
3. Protect the Family from Something Unforeseen
The next one I usually focus on is something that gets overlooked quite a bit, but is critically important: Protection for the family.
What if—God forbid—you had a premature death? Or disability? Personally, and professionally, I’ve unfortunately seen this happen. When those things happen, the last thing I want is for your family to be worried about money. How do you replace the income that was coming in?
Life and disability insurance are critical for young families, and thankfully, they’re not expensive. Your ability to generate income is your most valuable monetary asset. Insure it. If you’re building a plan for a young family, it’s hard to call the plan complete if this piece is missing.
Get the Basics Working in the Background
When life is moving fast with school, marriage, a house, debt, kids, etc., it’s easy to feel like you’re behind. You don’t need an elaborate strategy to start moving in the right direction.
Start with automation, keep saving consistently, and understand what you’re saving for, not just what you’re saving into. Lastly, make sure your family is protected so everyone can breathe a little easier.
If you want a practical next step, take 30 minutes and see what’s already in motion (or not)—your 401(k), your intermediate savings goals, and whether you’ve “buttoned up” protection the right way. That quick check-in can make the rest of the year feel a lot more manageable.
We are also here and welcome conversations with families getting started. Even if they are not necessarily ready for full wealth coaching, we count it an honor to help them identify the processes and decisions they need to get going in the right direction.