Ways to Prepare for the Unexpected
Life can be full of unexpected twists and turns, but planning can help prepare you for whatever comes your way. Let's look at general financial practices that can provide a layer of protection and provision when an emergency does arise.
Life can be full of unexpected twists and turns, but planning can help prepare you for whatever comes your way. There are many different kinds of hardship, expenses, and situations to consider when it comes to the unexpected in life. In this article, we’ll focus on general financial practices that can provide a layer of protection and provision when an emergency does arise.
By taking measures to protect yourself and your family, you can feel the peace of mind that you and your loved ones are better protected from potential financial hardships. Here are some steps you can follow to get started.
Build Three Months of Emergency Savings
An emergency fund can help you avoid relying on credit cards and building up more debt when an unexpected expense arises. Consider a goal of accumulating several months’ worth of income, which can be especially important for possible emergencies like the loss of a job.
- Start an emergency fund
- Create a plan
- Automate your emergency savings
Select the Right Amount of Insurance
Confirming that your insurance is up-to-date and accurate can help ensure that it provides proper coverage in the event that you actually need to use it. As you review, consider whether you’ve had any significant life events recently that may influence your policy, like a new family member.
- Review insurance coverage
- Adjust your coverage
Create a Will or a Trust
A will or trust may seem like something that can be handled far in the future, but addressing it now can help ensure that your loved ones are properly cared for if the worst should happen.
- Evaluate your estate planning needs
- Execute your estate plan
Protect Your Credit
Paying attention to your credit can help you detect fraudulent activity and correct any errors that may be on your credit report.
- Enroll in credit monitoring
- Review your credit report
Putting measures in place, including maintaining emergency savings, having the right amount of insurance, a will or trust, and credit monitoring, are all fundamental steps in maintaining financial health and stability. Completing these steps can provide peace of mind and protection against many potential financial losses. If you need help getting started or have a more specific financial situation that needs addressing, talk to a Money Coach.
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