The Three Risks You Need To Protect Your Family From

Let’s face it, there are some things in life that can happen that we have very little control over, and because of this it is imperative that we are prepared for any of the following risks because our family is counting on us.1. The Risk of Dying Too SoonOut of the three risks, this is probably one of the least likely ones to happen to us; however we have all heard stories of people passing away unexpectedly or way too soon, so we need to prepare for the possibility. It is most important when we are younger, maybe have young kids or have people relying on our income and our savings may not be at the level where it can replace the income the family was relying on, if this is the case, we need life insurance. If you were to pass away unexpectedly, you wouldn’t want to add a financial hardship to your family on top of their emotional hardship.The best way to prepare for this risk is by getting a lower costing non-convertible Term Life Insurance Policy. Typically, you will need 8 to 10 times your income. You want non-convertible Term, because as your responsibilities start decreasing, you can start decreasing the amount of coverage you need and add that extra savings to more important areas of your finances, like your retirement – because, down the road, you are going to need more money than you are going to need life insurance. I mean, later in life you will not be able to go to the grocery store and buy your groceries with your life insurance policy – you are actually going to need money. So, you want to spend as little money as possible on life insurance without exposing your family to any unnecessary risk. That way you can invest more money and have a better chance at reaching all of the financial goals and dreams you have set for your family.

2. The Risk of Living Too Long Today, with medical technology the way it is, people are living much longer lives. People are living longer into their retirement, and many times they are outliving their money. This is why it is so important during our working years, only for the years we need it, we should be buying the cheaper Term insurance. This way we are not wasting our money in a product we don’t need and we can invest more money towards our retirement, and we can give ourselves a much better chance of not outliving our money.The goal should be to get to the point where our investments reach or exceed the amount that we need life insurance coverage for. When this happens we become self-insured and at this point we no longer need the life insurance anymore, thus, freeing up money to put towards our “Living Too Long” fund. Three great things happen for us when we become self-insured:We no longer have to pay life insurance premiums.

We do not have to die to get the money.

Our money can continue to grow – for us!3. The Risk of Becoming DisabledNow, this risk is the most important risk that you must prepare your family for because if you do it right, it has the potential of covering the first two risks as well. We hear stories all of the time of people doing the right thing their whole lives – they have the right life insurance for their family and they have been investing religiously. The problem is, they don’t die – they get very sick, become disabled or whatever – and now they suffer financially because they never prepared for this type of scenario. When this happens, a lot of times their income goes down or stops altogether while their medical bills stack up on top of their already existing bills. The main problem is that most people have all of their income coming in from one source, like a job, and if, for whatever reason, they are no longer able to work, then the money they were once relying on no longer comes in.Today, more than ever, it is important to prepare for this risk, because it is becoming more and more prevalent. A good way to prepare for this is while you are working your job, look for a part-time opportunity where you can start to build a pipeline of income that comes in whether you work or not – an opportunity where you can get paid, not only off of your own efforts, but also off of the efforts of other people. This way you can get to the point where you are making the same amount of money or even more while possibly spending half the time, a third of the time or eventually, maybe even no time at all, and the money continues to come in. This way if you do become disabled, income can still come into your family without you working at all. And if you build your business right, the money can actually increase and take on a life of its own even while you are away from it.

By building a pipeline of income, you are, in essence, preparing for the first two risks as well. If you were to die too soon, that pipeline of income could keep coming in long after you are gone and if you were to live too long, that pipeline of income could ensure that you never outlive your money.