Navigating Uncertainty: The Importance of Having a "What If" Plan
2020 has highlighted the importance of having a “what if” plan for when the unexpected happens. Having a plan in place is key to handle the uncertain economy and ensure that you don’t face the impacts of the unexpected future.
Here’s the “what ifs” you need to consider so that you can be as prepared as possible in the event of an emergency:
1. What If I Lose My Job?
The thought of losing a job is stressful for everyone, but having a plan in place should you lose your job can help ease your worries and concerns. In order to prepare for an unexpected job loss, establish an emergency fund to help you get you through the next few months (aka an income strategy) should you need it. Most financial advisors recommend that you save three to six months' worth of living expenses1 in order to cover for an unexpected emergency, but how much you need will depend on your personal situation.
2. What If The Stock Market Declines?
The stock market can be very unpredictable which is why it's extremely important that you know how your money is invested should it drop unexpectedly. It's also very important to talk to a professional about what’s in your portfolio. Often times when the stock market takes a hit, people's first reaction is to pull their money from their investments. Although this might seem like a good idea in the moment, this isn't recommended. Instead, speak with a professional about your investment portfolio and let them know your concerns should the stock market decline. They will be able to give you tips and advice on what to do should that happen. Also, don't be afraid to get a second opinion about your current financial and investment plan to see if you need to make any changes to your portfolio.
3. What If I Don’t Have A Health And Long-Term Insurance Plan?
Ask yourself, what insurance policies do you have? From Accident & Health, to Long-Term Care, check with your employer and have your spouse check with their employer to know exactly what you do have. Do you know what they cover? It’s important to know the details of any policies you have before you need them. Once you know what is and is not covered, you will be able to come up with a plan, should you need it.
4. What If I Don’t Have A Plan of Action?
Don’t wait until the emergency happens to get help and devise a plan. Consider meeting with a Financial Advisor to make sure you’re better prepared for whatever the future holds. Having an action plan in place should you need it will not only help ease your concerns, but it will always miminize the financial impacts that a unforeseen crisis may bring.
Here's How Coastal Can Help You Prepare For The Unexpected:
At Coastal, we offer personalized financial reviews for Coastal members with our Coastal Wealth Management team, available through CFS*. This is a “planning approach”, meaning, before we make any recommendations we look at your unique circumstances before giving any financial advice.
Be sure to watch the video above to learn even more about how to navigate uncertainty. And, when you’re ready, connect with one of our advisors to schedule your complimentary financial review.
Why You Need an Emergency Fund