06 Jun Twelve Personal Finance Mistakes – Life and Disability
A big mistake that we make is that we believe that we are indestructible. Not Superman indestructible, but we don’t believe bad things happen to us.
We do know that uninsured medical bills are a major cause of bankruptcy. Yet we fail to take advantage of the insurances available to us to save on the premium and we fail to set that emergency fund aside for the possibility of something bad happening.
Some years ago, I represented a family who had suffered a huge medical setback. The husband, father, head of household, and chief executive of the family business, fell to a brain aneurism. He didn’t die, but the family business did and with it, went the family health insurance policy. And of course, so did the family income.
Just when things looked blackest, the family home burned down. The mistake? Lack of sufficient disability insurance and a large enough emergency fund. The retirement funds were used up to keep things afloat and luckily, there was enough homeowners insurance. The family is mostly OK now.
No one likes to think about the bad things that could happen. No one thinks that it could happen to them. I know I did. But experience has taught me otherwise.
Take the lessons that others have learned and get your plan in shape for the bad things that happen to good people.
Go Back to Part Ten – Plan Major Purchases
See Part Twelve – Retirement