Being intentional with your financial position depends on planning and creating habits that foster improvement. One element often overlooked is stress testing a wealth management plan.
Too often families just go buy insurance and think that their financial plan is protected. But insurance is just a financing tool and doesn’t have anything to do with minimizing or controlling risk, or recovering from a loss outside of just having money, or of addressing risk exposures that don’t fit inside the contract of insurance.
A better process is to save the act of buying insurance for the very last step – after you’ve identified and analyzed the things that could interrupt or derail your financial plan, after you’ve created steps to try and avoid or mitigate the risks that remain, and after all other financing options are investigated. The habit of just asking “what would happen if…” immediately improves your chances of being prepared to deal with it.
Photo: Rachael McGraw, Paris, France