Dear Dave,

My younger brother and his wife did their taxes last month and learned they owe $15,000 to the IRS. I love them both, but they are extremely irresponsible with money. I know they have a lot of credit card debt, too. I am debt-free, including my home after following your plan, and would like to help them. I was thinking about taking out a one-time loan from the bank to help cover what they owe the IRS, because my emergency fund is a little low after a recent car accident. Under the circumstances, would this be okay?

Carson

Dear Carson,

In my mind, “help” would be aiding them in changing their ways with money. I don’t say this to be sarcastic or mean, but it’s the truth about where they are in life right now. They both need to be educated, not enabled, when it comes to their behavior with money. This doesn’t mean they’re bad people, but it does mean you don’t need to be a party to, or a temporary fix for, their bad financial decisions.

Some people might say taking this attitude would mean you don’t love and care about your brother and his wife. Those people would be wrong. You’ve already told me they won’t behave with money, so at this point it would kind of be like giving a drunk a drink. You don’t give more money to people who won’t behave with it. That solves nothing, and in most cases it just reinforces the negative behavior.

This might be a good opportunity to sit down with your brother and his wife, and have a firm—but gentle—talk about their situation. Maybe you could offer to teach them the things that worked for you when it comes to finances, using the Baby Steps as your guide. And, make sure they get in touch with the IRS about a payment plan.

I know you love them, but you can’t fix this for them. In some cases, the best thing you can give someone is the understanding that they need to change their behavior. Hopefully, with you as their inspiration and support, they can learn how to manage their finances wisely.

Good luck, and God bless you all, Carson!

— Dave

* Dave Ramsey is a seven-time #1 national best-selling author, personal finance expert, and host of The Ramsey Show, heard by more than 18 million listeners each week. He has appeared on Good Morning America, CBS This Morning, Today Show, Fox News, CNN, Fox Business, and many more. Since 1992, Dave has helped people regain control of their money, build wealth and enhance their lives. He also serves as CEO for Ramsey Solutions.

Dear Dave,

A relative of mine recently mentioned she had two life insurance policies. Is it okay for a person to have more than one life insurance policy? If so, why would someone do that?

Victoria

Dear Victoria,

There aren’t any rules against having more than one life insurance policy. The only real problem is it might complicate your life a little in terms of having multiple premium withdrawals, checks or possibly additional policy fees to worry about every month. It’s cheaper just to have just one policy, generally speaking, but regardless of whether you have one or more, I always recommend having 10 to 12 times your annual income wrapped up in a good, level term life insurance policy.

Different people have different personal and business financial situations, so there could be many reasons to have more than one life insurance policy. I have lots of insurance connected to our estate plan, our business and different kinds of things. Most life insurance companies will only write so much in coverage for one person, so when this has been the case, I just went to another carrier for additional coverage.

Also, some people buy more than one life insurance policy just to feel secure from a provider standpoint. If one insurance company goes out of business, they’ll still have another policy—or more—in place. That’s not usually a big problem, though, since the majority of insurance companies have insurance to back them up with the state, or are very financially stable.

I hope this helps, Victoria!

— Dave

 * Dave Ramsey is a seven-time #1 national best-selling author, personal finance expert, and host of The Ramsey Show, heard by more than 18 million listeners each week. He has appeared on Good Morning America, CBS This Morning, Today Show, Fox News, CNN, Fox Business, and many more. Since 1992, Dave has helped people regain control of their money, build wealth and enhance their lives. He also serves as CEO for Ramsey Solutions.

Dear Dave,

I own a small business. How much should I have in a business emergency fund when my annual sales are around $100,000? Currently, I have two months of expenses set aside.

Theresa

Dear Theresa,

Generally, I like the idea of small businesses having about six months of expenses on hand. That kind of cushion usually eliminates the need for borrowing money. It also provides peace of mind. And if you’ve been an entrepreneur very long, you know that’s an invaluable thing.

Having a personal emergency fund set aside is a little different than having one in place for your business. When it comes to personal finance, I recommend having three to six months of expenses set aside. The basic idea is the same, though. A fully-funded emergency fund gives you an option—besides debt—when unexpected things happen!

— Dave

* Dave Ramsey is a seven-time #1 national best-selling author, personal finance expert, and host of The Ramsey Show, heard by more than 18 million listeners each week. He has appeared on Good Morning America, CBS This Morning, Today Show, Fox News, CNN, Fox Business, and many more. Since 1992, Dave has helped people regain control of their money, build wealth and enhance their lives. He also serves as CEO for Ramsey Solutions.