Financial planning can be a daunting task. Preparing for the future means facing unpleasant possibilities, such as illness, the loss of independence, disability, and even death. However, a failure to plan for these things will make it much harder to cope with them if and when they do arise. A solid financial plan will include preparations for a variety of scenarios.
There are many different types of insurance that can help with costs incurred if you can no longer work. Life insurance is one of the most well-known, and can help give your family some stability after your death. While contemplating the end of your life (or that of a loved one) is never enjoyable, knowing that you can take care of those you leave behind can help you to have some peace of mind.
For a small monthly, semiannual, or annual payment, you can carry a sizeable life insurance policy that will help your loved ones. This is especially important if you are the primary earner in your family. However, consider a policy for all family members. For instance, if a stay-at-home mother passes away, the family may have to hire outside help to fill her role in caring for the household.
Planning for your financial future should also include some preparations in case you lose the ability to work. According to the U.S. Federal Reserve Board, as many as 68% of families have no savings set aside for an emergency. Some employers offer disability insurance, but it is often short-term and may not cover all of your expenses. It is recommended that you purchase additional coverage in case of long-term disability. Long-term care insurance will cover assisted living in case you can no longer care for yourself. This is usually not covered by health insurance, and can wipe out a family’s savings.
Other types of insurance that may protect your financial future include auto insurance and homeowner’s or renter’s insurance. These can help protect your most valuable assets, as well as protect you in case someone else is injured by your vehicle or on your property.
Your financial planner will help you determine which types of insurance will help you, and the coverage amounts that are necessary to protect your family. Start planning today and feel safe for tomorrow.