Protect Your Assets From Unexpected Events

Larry Olivarez Jr.

Life is full of surprises both good and bad. If you’re unprepared financially to handle them, these events could leave you feeling anxious about your financial situation. Protecting the assets you’ve already accumulated and your ability to continue building for your future is essential to preparing for the unexpected.
 
Consider the following examples of how unplanned events could impact your finances:
•     The sudden, untimely death of a caregiver for young children could create immediate financial hardship. It could also mean that key goals, such as college or retirement, could seem out of reach.
•     An unexpected illness or injury could keep you or your spouse from working. If the disability continues for an extended period of time, it could lead to a major financial strain for your household. Once again, funding for important long-term goals may need to be reevaluated.
•     A medical condition suddenly arises that requires significant treatment. Without adequate healthcare coverage, you may need to liquidate savings intended for other purposes.
 
As you think about the potential surprises in your life, evaluate your current situation and consider whether your protection strategy is adequate in the following categories:
 
Life insurance
This is one of the most fundamental forms of insurance – protection for family members if you or your spouse should die. The consequences of death can be devastating to a family in many ways, not the least of which is financially. Keep in mind that there is a financial impact even if either of you are not earning income outside the home. If you are a stay-at-home spouse or volunteer, the role you play at home will need to be filled should you pass away unexpectedly. It’s recommended to have sufficient life insurance in place to replace the lost income and to cover a lifetime of needs for your family.
 
Disability income insurance
Many people overlook the financial risk of a disabling injury or illness, assuming their health insurance will cover additional expenses. If you incur an injury or illness that prevents you from earning your regular income, disability income insurance helps replace that income. This coverage is often offered by your employer, and most plans offer several levels of coverage as a percentage of your income. Make certain your coverage is sufficient to truly protect all of your income needs in the event of a protracted illness or injury.
 
Extended care / Long-term care insurance
Costs for in-home care, assisted living or a nursing home can be substantial, even if you have a healthy amount saved for retirement. Extended care or long-term care insurance can be used to address a significant health event, pay for medication or treatment, and can help secure quality specialized care.
 
Property / casualty coverage
While you’re likely to have auto and home insurance, it’s important to make sure you have enough coverage. Common underinsured areas:

• Look specifically at the following limits in your car insurance policy: personal injury protection, collision / comprehensive, uninsured / underinsured motorists and roadside assistance, among others.
• For your home, consider if you’re covered for home media and computer equipment, adventure equipment (golf clubs, bikes, fishing equipment, etc.), and high-value items like fine jewelry, art, collections, musical instruments or china.
• Take a look at specialty insurance for big-ticket items like boats, ATVs, RVs, collector cars and motorcycles as well as special circumstances like pet, earthquake or flood insurance.

 
Health insurance
The law now requires that you have coverage for medical expenses. You may participate in an employer-sponsored health plan, or you may obtain individual coverage. If you’ve reached age 65, Medicare can be an option. Also consider if vision or dental insurance makes sense for your family. To get started, add up your total healthcare costs last year, then estimate the amount you’ll need next year. Talk to potential insurance providers (or your employer if they offer these plans) about how insurance could be applied to services like new contacts, required surgeries and procedures, or your teen’s braces.
 
Emergency fund
For unplanned expenses not covered by insurance, consider having cash available in an emergency fund. Whether this is to replace a furnace or to help meet a short-term income need, a good rule of thumb is to have at least six-to-nine months of income in an easily accessible savings account.
 
Consider sharing your current situation and potential gaps with a financial advisor who can help you look at your coverage in the context of your goals and other financial obligations.
 
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Larry Olivarez, Jr. CEP^®, is a Financial Advisor with Ameriprise Financial Services, Inc. in Corpus Christi, Alice, and surrounding areas of South Texas.    He specializes in fee-based financial planning and asset management strategies and has been in practice for 13 years.  To contact him please call 361.654.1900 in the Corpus Christi office located at 711 N Caranchua Suite #1701 or 361.668.1212 in the Alice office located at 604 E. Second St.
Email: larry.x.olivarez@ampf.com ¨  Website: ameripriseadvisors.com/larry.x.olivarez/
 
Before you purchase, be sure to ask your advisor about the insurance policy’s features, benefits and fees, and whether the insurance is appropriate for you, based upon your financial situation and objectives.
 
Investment advisory products and services are made available through Ameriprise Financial Services, Inc., a registered investment adviser.
Ameriprise Financial Services, Inc. Member FINRA and SIPC
 
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