cvas_lg.gifAs important as your saving and spending habits are, being truly financially responsible involves much more. To this end, I’ve put together some ways to cover your ass (ets).

Wealth Creation to Wealth Protection Equals Financial Planning

… This list is by no means exhaustive, but it’s a good starting point.

Do you have life and Disability Insurance Of course this really only applies if someone depends on you for support. I’m a big fan of life insurance. And don’t just rely on the insurance that you get through your employer… The base coverage may not be enough for your needs, and it’s also tied to your employment — lose your job and you’ll lose your insurance. Also, if you’re young and in good health, you can probably get a term policy for less money by shopping around instead of buying additional group through your employer.

“Life Insurance is like a parachute, if you don’t have it when you need it, its too late”.

For the average person the odds of suffering a debilitating injury are considerably higher than the odds of dying young. What if you couldn’t work? How would you get by? Long-term disability insurance covers your butt in the event of that you suffer, well, a long-term disability.


Health Insurance. When you’re young and in good health, you feel invincible. But even a relatively minor health problem can prove to be a major setback if you’re uninsured. And a major health problem can be catastrophic. Even when I was young and dumb (and otherwise uninsured), I carried a major medical policy. It costed peanuts for a policy that covered accidental injuries and illnesses requiring hospitalization.

Personal Liability Insurance policy. Carrying personal liability insurance is particularly important for homeowners and/or those with substantial personal assets. Standard homeowner’s, renter’s, and auto policies provide a degree of liability protection, but a personal liability umbrella policy picks up where these other policies leave off.

Have you made a will? Having a will greatly simplifies the process of disbursing your assets after your death, and can go along way toward easing unnecessary burdens on your loved ones during an exceptionally difficult time. Many a times people manage their lives quite well but leave things in utter mess on their death. If you don’t, the court will. Hopefully they’ll make a good decision, but there are no guarantees.

If you have specific wishes when it comes to health care decisions that might need to be made while you’re incapacitated, then you’ll want to arrange to have a like-minded person at the helm.

Grant power of attorney to someone you trust. If you’re ever incapacitated, someone is going to have to make financial decisions on your behalf. Wouldn’t you like to be the one who chooses who this will be? Same goes for health care power of attorney.

Keep everything updated, and re-assess your needs periodically. This is an incredibly important point. If you don’t re-evaluate your situation periodically, your hard work will be all for naught, as your needs will change over time. For example, lets say bought term life policies some time back but, after a number of major changes in your life, you might need to increase your coverage some time later.