Some First Steps to Secure Financial Planning

I am sure that none of you reading this would think that building a house by beginning with the roof would be a great idea. In fact it would be impossible. The roof would need support. Let's use the analogy of a house to see the elements of a financial plan and their priorities.

Every house starts with a foundation. The foundation of financial success is as follows:

A WILL. Do you want a court to allocate your assets to your heirs? At the least do your assets have named beneficiaries? Your estate is not a named beneficiary. If you are married are your assets in joint names? Who needs to protect their income? The answer: any breadwinner who has the two Ds, dependents or debts. Do you have financial responsibilities that will carry on after you pass away? It is becoming more common for people who thought they were in good health to discover they have serious medical conditions.

Again that is true risk; to assume that tomorrow next week, next month or next year wil be the same as today.In that same line of thought a group coverage should only be considered as a supplement. How many people will have the same job five years from now as today? A person has control over private vs. group coverage. Having control over various aspects of persoanal finances greatly increases the opportunity for financial independence.


An emergency fund. Savings in case of the unexpected. The unexpected is usually a costly event. An emergency fund should not be a line of credit!! Contrary to popular opinion a line of credit as an emergency fund is real risk, far more risky that investing in equities. Income protection.

The foundation of the financial house ensures that you can answer YES to the question: Are you ready for anything? Check out part 2 of this article here.

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