Preparing for Unexpected Expenses
Who’s Got Your Back?
One of the key elements in developing financial resilience is preparing for unexpected disruptions. They are guaranteed to happen to everyone. From health issues to work challenges to natural disasters – it’s a part of life. Although you can’t control when or what happens, you can plan and prepare. Plan and prepare for unexpected expenses.
A strong risk management plan includes resources and expertise from people and businesses you trust. It can take years to build a team of professionals from a wide range of industries. Developing relationships before an emergency happens, will help reduce some of the early anxiety or panic of the moment.
Line of Defense
As you prepare for unexpected expenses that might come up, think of ways to develop several layers of defense. For example, in order to reduce the risk of property being stolen, do more than lock your front door. Add a security camera or alarm system. Keep a record of the make/model number and purchase info of important property. Make it hard to find or get to valuables.
Another line of defense includes a plan to replace, restore or start over. An emergency savings, a line of credit or an insurance policy should all be part of a risk management plan. Some risks you can handle on your own, while others will require more resources than you have access to.
Emergency Savings + Insurance + Legal Documents
Emergency Savings – allows you to carry higher deductibles, which equates to lower premiums. It gives you freedom to make the best choices for yourself and loved ones. Make sure you can access those funds quickly when needed.
Insurance – explore your options to protect yourself, your income and your property from unexpected disruptions. Review at least once a year to make sure each one still fits your needs.
Legal Documents – from a Power of Attorney to a Living Will, these are an absolute must in being prepared for the unexpected. Make sure your wishes are heard.
Sometimes it can be incredibly challenging to stay focused and committed to building a life you love. If you are feeling overwhelmed and looking for support, check out Financial Wellness 101 – The Ultimate Financial Handbook for Young Professionals. We also offer 1:1 Financial Coaching to help you create a clear roadmap to improve financial wellness.