How to Plan for the Unexpected

The unforeseen events in our lives can give us uneasiness.  They come in two different packages – exciting ones and stressful ones.

The stressful ones can be:

  •      Loss of a spouse or family member
  •      Loss of a business partner or key employee
  •      Loss of a job
  •      Sickness or an injury
  •      A large, negative market correction

The exciting ones can be:

  •      A child who was not planned (this can also be stressful)
  •      A business opportunity
  •      A “dream job” opportunity 

Over the years, we have worked with many families, individuals, and business owners through the loss of an important person – sometimes very unexpectedly. The loss is a LOSS and can only be worked through with time and with helping hands.  All of these have an economic impact to some degree. The best way to handle these is a risk assessment of the loss before it happens. We cannot ease the loss, but we can ease the economic impact.

Loss of a job or a career can be emotionally devastating.  The best way to handle this is to always have your eyes wide open. Continue to always educate yourself on your industry and specifically what you do in that industry. How easily can you be replaced? What is your Plan B?  Stay ahead of the curve. Always be economically relevant to society – remember, move your “comfort zone” away from the “safety zone.”

Sickness or injury cannot be foreseen. Again, a risk assessment is vital. Review the medical, disability, and (yes) extended care insurance you have. Sometimes you may have holes you cannot fill, but at least you can have your eyes wide open.

Market correction – what else can be said about that? They happen and will continue to happen. They will happen while you are working and while you are retired and while you are in extended care. The best way to handle them is the “Life Boat Drill.”  Do not put your head in the sand, know what you can handle. Eyes wide open.

The exciting ones are, well – exciting.  However, always be prepared to take advantage of them.  If your Dream House came along would you have the financial profile to take advantage of the opportunity? Some people save all their wealth in their 401(k) –  that's a big tax door to get out of prior to retirement.  Go back to the “foreseen events” and plan well.

OK – reality check.  Our asset allocations are perfect.  Our life expectancies are to the month.  Our simulations are precise. We can show you “certainty” –  NOT.  People want “certainty.” Unfortunately, it is not there and I believe the public knows that.

Let’s be transparent – we do not know what will happen. Carl Richards (an author on behavioral economics) says your Wealth Advisor is your guide in a changing world who has many experiences that can help you - use them to your advantage. The public wants a trusted advisor to guide them through uncertainty rather than sell them a false promise of certainty.

Let’s do it together.

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