The Importance of Planning Ahead: Guide to Preparing for Disability o Death

What’s the worst that can happen? Usually that question tends to come across our minds, when we are at a crossroads. But, sometimes we never really think of that question when it might really matter, as much as we may plan our lives, there's always some type of curveball thrown our way, making life unpredictable, to say the least. Unforeseen circumstances, such as disability or death can negatively impact the financial stability of your family. However, by taking the necessary steps, you can guarantee that your family will be financially stable and secure. Here are some strategies to best prepare for emergencies:

Consider Purchasing Long-Term Disability Insurance

If you become disabled and are unable to work, long-term disability insurance coverage will provide you with a source of income. Compared to the short-term disability by your employer, which normally will provide you coverage for an average of 3-6 months, long-term disability insurance can offer coverage for a significantly longer period of time, and in some cases even up to retirement age. In the event that you become disabled long term, the long-term disability insurance will also offer you a peace of mind.

Review your Life Insurance Coverage

Life insurance will provide financial support to your family in the event of your death and help protect your family’s financial future. Be sure to regularly review your life insurance coverage to ensure that it aligns with the financial security goals you have for your loved ones.

Save Towards an Emergency Fund

When saving, be sure to also have an emergency fund because you never know what could happen. In addition to covering unforeseen costs, having an emergency fund will make managing the situation easier because you'll be better prepared financially. To effectively save towards an emergency fund, it’s recommended to save 3-6 months of expenses, so create a budget and set that as your goal.

Create an Estate Plan

An estate plan is very important when securing your loved one’s financial future and also a way to ensure that your assets are distributed as you wished, in the event of your death. By creating an estate plan, not only will it reflect your wishes and financial goals, but it ensures that the financial legacy you have created will continue. When creating an estate plan this includes creating a will, creating a trust, and updating your power of attorney. When creating an estate plan, work with an attorney and make sure you keep it up-to-date to reflect your current wishes and circumstances.

Keep your Loved Ones in the Loop

Another piece of advice for planning ahead is to talk to your loved ones about your financial goals so they can know about your intentions and support you, in any way that they can. Your loved ones will be more likely to carry out your wishes, in the event of your death since they would be aware of exactly what you would have desired and the legacy you intended to leave. Your loved ones may also want to contribute financially on their end in the event of long-term disability and a reduced income because of these continuous open and honest discussions you’ve had regarding your family's financial future.

So, all financial plans should include strategies for managing unexpected situations, because that’s just how life is. By using these tips to protect your income and assets, and your family’s financial future you can help ensure the financial stability and security of yourself and your loved ones during any emergency. Consider consulting a financial advisor to develop a comprehensive plan that aligns with your financial goals and provides the security best suited for your family.