Contrary to popular belief, your savings and investments are not the foundation of your financial plans.
Financial risk management is! Managing the financial risks of life events that are beyond your control is the foundation of a solid financial plan.
As human beings (and mere mortals), we are all exposed to risks every day and sometimes bad things happen to good, healthy, and active people like you and me.
These are serious life events that are beyond our control, and unfortunately, most of us fail to plan for such events; believing that this kind of thing only happens to other people.
As responsible adults, most of us would have started some form of savings or investment account(s) such as a bank savings account, a TFSA, or an RRSP but most of us fail to plan for the worst possible events that could affect our ability to make a living.
Yet, it isn’t surprising that most of us know or at least have heard of someone active and healthy being inflicted with a serious illness or disability and as you may be well aware of, some people do pass-away prematurely.
The problem with these events is that they don’t usually come with a warning so that we can better prepare for them, both emotionally and financially.
When a person gets inflicted with a serious illness or an injury; most often than not, that individual has to stay home (or in the hospital) to recover from the illness or disability.
Staying home means that you’re unable to work for a living; should you find yourself in such a situation.
To effectively manage the financial risks associated with these serious life events, it is important to acknowledge the fact that as human beings, we’re susceptible to the risks of illness, disability, or death and as such, we have to take the necessary measures to protect ourselves and loved ones against the financial risks associated with these events such as loss of or reduced income.
Insurance provides you with a solid financial foundation against these risks so your financial security, plan, and future need not collapse should life throw these weird curve balls at you.