Life is unpredictable, but we must go on even after tragic events like an accident. It is therefore wise to be financially prepared in case an unfortunate incident happens. Your financial health is essential not just to you but to your family. So, how do you secure your family’s financial future in the event of an accident? Let’s find out some of the things you can do in the article below.
Insurance
A good insurance policy is one of the investments you can make towards your and your family’s future in case the unforeseen happens. You can look into various insurance policies, including illness, accident, and life insurance. If you are involved in an accident and are unable to work and take care of your needs, then the payout from the insurance company will be used in the meantime. If your accident was caused by someone else’s negligence, such as a car accident, you may be able to make a claim against their insurance to provide for your medical bills and lost wages, you could also receive damages for the pain and suffering you have experienced. Your family does not need to worry about expenses when they can spend time and take care of you when you most need them.
A life insurance policy is a sound investment because it cushions your family against worrying about finances after you have passed on. It allows them to focus on what needs to be done after death, like taking care of the funeral expenses. The family lawyer can ensure that the insurance claim is filed as soon as possible and the payment is made out to the beneficiaries on time.
Emergency Fund
Financial experts advise people to maintain an emergency fund where they keep at least six months’ worth of living expenses. These funds will come in handy after an accident because then the family will not be immediately thrown into panic mode. This fund will allow you and your loved ones to stay afloat until you can calmly think of the next course of action. The best way to build your emergency fund is to start small, and eventually it will have a substantial amount.
Investments
Investments are a great way to make your money work for you as you grow your wealth. It is advisable to have a diversified portfolio where you have invested in different types of assets, including mutual funds, bonds, stocks, and real estate. A diversified portfolio allows you to spread your risks and increase the payout. There is no one way to get it right, as different options carry different risks and rewards. You want to have an investment professional walk you through all the best possible options available to you.
After your accident, you can liquidate assets or withdraw some funds from these markets and use them to meet your day-to-day needs. These investments will allow you to have the peace of mind and mental clarity you need to recover from the accident. It is essential to let your family know of your investments so that they are not unclaimed after you pass on or are mentally or physically incapacitated. You can also hire a trustee who will manage your assets and release them to the family in case of an accident.
Estate Planning
Making a will has been and will always be one of the most important financial decisions you will have made when you were alive. While there is a common misconception that estate planning is only for the wealthy, everyone should do it. This is because it clearly states where and to whom your assets will go in your absence. Estate planning is even more crucial when you are married and have kids. The last thing you want is to have your loved ones grieving and also engrossed in court battles over your estate. Your will reduces any disagreements and confusion as it acts as irrefutable evidence of your final wishes. You should also regularly update your estate plan so that it can cover new life changes and cater to those you love.
Communicate
It would be such a tragedy if you were involved in an accident, fell into a coma, or died, and your family could not locate essential documents. You may have taken all the proper steps, including planning your estate, investing, and even having an emergency fund, but no one knows about it. These measures will not be helpful to your family if they do not know they exist. You should regularly have discussions with your family members so that they understand what you own and where they can get the necessary documents in case of an accident. This way, you will have ensured that your investments and financial planning will pay off and serve your family in the time of need.
Taking care of your family does not have to be curtailed by an accident. This is only possible with the proper financial planning, and you get to do it while you are alive and well.
