Staying guard at the top of the stairs is an acceptable position, but not ideal. Ideally, you will have a better form of cover. If there is a closet in the master bedroom that is out of the way of a possible exchange of gunfire, I would put my family there. If your wife knows how to handle a gun, I would keep one that she is familiar with in the closet in case something happens to you.
Also, make sure to test that you get a good cell phone signal wherever your wide and children will be hiding, they need to be in direct and effective communication with police in such an encounter.
I also agree to keep from a conversation with the BG. A simple command to leave and that the police are in their way is all that is necessary. Don't say anything about being armed, don't say that you will kill them should they do ____.
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