Protecting Your Family Financially
Updated: Apr 3, 2020
The following is an article “Protecting Your Family Financially” by Marc Primo.
The story of Westgate Resorts CEO David Siegel gave us one of the most heartbreaking riches to rags story we’ve ever encountered back in 2013. Building a timeshare empire and what was hyped as the largest mansion in the U.S., Siegel found his company in financial quagmire and his dream mansion foreclosed due to the financial crisis. If there’s one thing that we can learn from Siegel’s story, it’s how to rebound from a gigantic loss and pull back business in the upswing.
But what if your entire family relied on your business and you really can’t afford to suffer an unimaginable loss? No one wants to put their families into a life of poverty, more so after they have tasted the comforts of wealth.
Here are some tips on how you can protect your family financially while business is booming.
Avail of life insurance. One of the most essential things for financial security is a life insurance policy that ensures benefits for you and your family. Avail of one with quality coverage that only lets you shell out a minimal monthly contribution but offers attractive returns. Get one while you are young as price ranges can depend according to age and health and look for an insurance that can both cover your existing loans and what you currently earn.
Set up an emergency fund. Being able to cover for emergencies without resorting to loans will go a long way in helping you manage your finances. Having fluid accounts that amount to half a year or a year’s worth of your expenses is ample enough to get you through a difficult time without using your credit card. Aside from ensuring your family’s security by making sure that they don’t need to worry about costs in an untoward event, you also will be able to confidently weather the inevitable storms of life until everything returns back to normal.
Apply for disability insurance. While most people really don’t see the need for this type of insurance, this is one of the more important things you can secure your family with financially when illness or disability strikes. Disability insurance ensures that you can still lead a life of security while you are living but can’t work normally. Study the various available alternatives for disability insurance. Some can cover as much as two-thirds of your monthly salary so review your coverage options well. Another form is mortgage disability insurance which ensures that payments for your house continue even if you are unable to work.
Plan your will. Protecting your family financially while you are able and earning all boils down to having a great plan. This means that you’ll have to make considerations about executing a will that ensures your assets go to the proper family members. Most people avoid doing this due to the ominous thought of death but this is really something that should not be left undone. Your family deserves to receive whatever you have accumulated in life and preparing a living will and appointing a power of attorney early on formalizes everything according to your terms. This also spares them the hassle of taking care of loose financial ends that they will have to go crazy over after you’re gone.