Your Personal Financial Plan - You Won't Retire Without One, Part 2

If you arrived on this page without reading Part 1, then click here for Part 1 of "Your Personal Financial Plan - You Won't Retire Without One"





Personal Financial Plan
Legal Protection
What good does it do you to build up a sizeable retirement nest egg only to lose it in a lawsuit? Your financial planner should be able to offer you a legal protection plan so you can set up your will, living will and have access to legal advice whenever you need it.

One of the most popular and affordable legal protection plans is provided by Pre-Paid Legal. Just do a search in Google for them. It's about $25 a month. Affordable for even a college student.

Personal Financial Plan
Health Insurance
Be sure to get yourself, your spouse and kids covered under a good health insurance plan. Does your job offer coverage? If so, take advantage of it.

If not, find outside coverage. If you're self employed or if your job doesn't offer any health insurance coverage, you may be able to get covered through the National Association for the Self-Employed. Just Google NASE.

Personal Financial Plan
Auto Insurance
Obviously, auto insurance is necessary, but not for the reason you may think. Yes, it's vital if you're involved in a car accident to cover any damages. However, most people don't have enough auto insurance coverage.

Are you currently covered only at your state minimum coverage amounts? If so, why? If you're at fault for a car accident, don't you think you could be sued for an amount much larger than what your minimum coverage is set at?

Seriously consider raising your auto insurance coverage to much higher levels to make sure you're properly covered. Your financial planner should be able to advise the correct amounts based on the amount of your current assets.

Personal Financial Plan
Rent vs Own Analysis
If you currently rent, I'm sure you're very aware of the fact that you're throwing away money on rent by not investing in your own home. Your financial planner should be able to offer you a "rent vs own analysis" that shows you clearly the long-term benefits of owning your own home as opposed to continuing to rent.

Once you see the difference of owning, you'll be more motivated to pay off your consumer debt and save toward a down-payment on your first home.

Personal Financial Plan
Emergency Fund
Once your financial planner has you on a plan to get out of debt, he or she should also provide you a plan to stay out. A vital aspect of this idea is to establish an emergency fund.

You can contribute a monthly amount of money into a money market fund until you've built up at least three to six months of income into our emergency fund. Now, when the car breaks down or the washing machine needs replacing, you can use cash instead of going back to racking up credit card debt.

If your financial planner doesn't provide all this for you, it's time to find one who will. Oh, and by the way, demand that they provide this type of financial plan in writing completely free of charge for you. They should earn their income on the services you need within the financial plan, not on selling you the information.

Make them earn their keep by helping you actually enact the plan. Selling you a written personal financial plan that sits in your drawer does no one any good except the person who sold it.

Change your life,

Matt


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