When Things Go Wrong
Not everything in our lives will go right.
Sometimes, things go wrong—a busted aircon, a leaking roof, minor car bump. These happen anytime and even the worst of time simply because not all can be planned and prevented. This is best summarized with Murpy’s Law saying, “whatever can go wrong, will go wrong.”
As these happen—invariably or inevitably—it’s incumbent upon us to prepare for these eventualities. I’m not saying these will surely happen, but if and should they do, it would be best not to be caught with our pants down. Think of the spare tire in your car and life vest in the plane or boat that you’re riding. You hope you won’t need them and avoid instances of needing them, but they’re there nonetheless, just in case. So it’s really best to prepare for possible events. Here are tips to better prepare.
Anticipate and contemplate. Think of various things and events that can happen in your life, family, and properties. What you can anticipate and contemplate, you can prepare for. For instance, it’s possible your car or some of its parts can breakdown anytime, or your roof would need repair. With you or your family, it could be a medical emergency or an accident.
Things may also happen with your siblings, parents or relatives that might need your financially support But whatever the case, anyone can reasonably look into the different possibilities that can be determined and mapped out.
Back-Up. Once I was accidentally bitten by a cat, and not a few times I figured in car accidents of which I’m thankful for coming out alive. I’m also unfamiliar with car repairs. Once, my aircon broke down in the middle of Skyway, and there are times when signal lights got busted. In all cases, they required large amount of money of which I’m lucky enough to be covered.
In the case of the cat bite, the total bill was P72,000 for anti-rabies shots. During that time, I was covered by an HMO so I didn’t have to shell out a single centavo. For the car accidents, my vehicle was covered by insurance so I spent minimally. As for the various repairs needed by my car, our family had an emergency fund (for more than six months) so I didn’t have to scramble looking for cash or go into loans.
There was also a time when my eldest had to be confined for dengue which was also covered by an HMO so again our expenses were minimal. We also used our emergency fund for this. Of course, I’m covered by life insurance enough to provide for my family in case something happens to me.
These emergency funds and insurance are back-up resources should unfortunate events happen to us. They give the means to pay for expenses to spare us from stress.
Back-up’s back-up. There are 36 letters in the alphabet. If Plan A doesn’t work, there’s always Plan B, C, and so on. Back-ups can also be backed-up for extra cushion. For instance, apart from the six-month emergency fund, we have established at least three more months of emergency fund should there be need to fund a huge financial requirement.
When I quit my day job to focus on my financial planning profession, I was thankful we have more than enough funds to support us while establishing the business without compromising our needs. Apart from our living expenses, I also have supplemental insurance for our children’s education from pre-school up to college.
In sum, financial planning is not only about planning and preparing for goals. Its also about preparing for scenarios and events that may occur and affect our finances. Doing so would provide the necessary safety nets we can readily tap for a worry-free life.
Rienzie P. Biolena is a Registered Financial Planner of RFP Philippines. He’s president and chief financial planner of WealthArki and Consultancy, a financial planning firm. Learn more about personal financial planning at the 71st RFP program in September 2018. To inquire, e-mail firstname.lastname@example.org or text <name><e-mail><RFP> to 0917-9689774.
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