9 Financial Milestones Every Firefighter Should Aim For

By hitting these milestones, you’ll not only ensure your own security but also provide peace of mind for your loved ones

By CRACKYL staff

When it comes to your finances, are you protecting yourself as much as you protect others on the job? Financial security doesn’t just happen (although we wish it did!) – it’s built with intention and planning. So we sat down, did some research, and compiled the following key financial milestones every firefighter should aim for to ensure a stable financial future. First up:

1. Establish an Emergency Fund

We know better than anyone that emergencies are unpredictable. That’s why having an emergency fund is essential. Aim to save three to six months’ worth of living expenses. This safety net can help you cover unexpected costs like home repairs, medical bills, or even temporary loss of income.

Pro tip: Automate your savings so a portion of each paycheck goes directly into a high-yield savings account.

2. Maximize Retirement Contributions

Firefighters often have access to robust pension plans, but that shouldn’t be your only retirement strategy. Contributing to a 457(b) plan or an IRA can supplement your pension and ensure you have more than enough for your golden years.

Action step: Check if your employer offers matching contributions to a retirement account. If they do, contribute at least enough to get the full match.

3. Pay Off High-Interest Debt

Carrying high-interest debt, like credit card balances, can weigh you down financially. Prioritize paying off these debts to free up cash for savings and investments.

Strategy: Use the snowball or avalanche method to tackle your debts systematically. Start small if you need the motivational wins, or focus on the highest interest rate for maximum savings.

4. Invest in Insurance

Your job comes with risks, making insurance a critical part of your financial plans. Life insurance ensures your family is financially protected if the unthinkable happens, while disability insurance provides income if you’re injured and can’t work.

Tip: Consider both term life insurance and an occupation-specific disability policy tailored to firefighters.

5. Save for Big-Ticket Goals

Whether it’s buying a house, sending your kids to college, or planning a dream vacation, big-ticket goals require planning. Start by defining your goals and creating a savings plan for each.

Pro tip: Use separate savings accounts or buckets for each goal. This makes it easier to track your progress and stay motivated.

6. Understand Your Pension Plan

Most firefighters are fortunate to have access to a pension. However, understanding the details of your pension, like when you can start collecting and how much you’ll receive, is crucial for long-term planning.

Homework: Attend any pension workshops your department offers, or consult a financial advisor who specializes in public service pensions.

7. Create an Estate Plan

Estate planning isn’t just for the wealthy. It’s about ensuring your loved ones are cared for and your assets are distributed according to your wishes. A basic estate plan includes a will, power of attorney, and healthcare directive.

Quick win: Update your beneficiary designations on retirement accounts and life insurance policies. These often bypass a will.

8. Explore Additional Income Streams

Many firefighters take on side gigs or invest to boost their income. Whether it’s real estate, teaching, or starting a small business, diversifying your income can provide extra financial security.

Idea: Choose something you’re passionate about that also fits your schedule. For example, many firefighters work as EMT trainers or invest in rental properties.

9. Regularly Review Your Financial Plan

Life changes, and so should your financial plan. Make it a habit to review your budget, savings, and investments at least once a year. Adjust as needed to stay on track with your goals.

Pro tip: Consider working with a financial planner who understands the unique challenges and opportunities of firefighting careers.

The Last Word

By hitting these milestones, you’ll not only ensure your own security but also provide peace of mind for your loved ones. Every small step adds up, and the sooner you start, the stronger your financial foundation will be in the future.

CRACKYL Magazine recommends you seek professional financial advice before you make any financial decisions.