The last time you were at the circus did you gasp as the trapeze artist swung through the air?
Even though his antics might be scary, there’s a strong safety net catch him in the event of a fall. Hopefully, the trapeze artist won’t ever need to use it. But it is always there – just in case.
Even the world’s best acrobats have safety nets to catch them if the unfortunate occurs. So what does that say for the rest of us, who aren’t the world’s best?
Even if you’re not a trapeze artist, you need a safety net. As long as you have dependents, you need a safety net to save you from fiscal free fall.
Sometimes, the “fall” can be the result of poor financial planning and decision-making, but often it’s due to circumstances that are beyond your control.
For this reason, it’s important to make sure you have a safety net in place. In terms of personal finance, this is a two-pronged approach: making sure that you have adequate insurance and having an emergency savings account.
If you have young dependents, insurance is absolutely vital. What would happen if your family’s breadwinner(s) died or was seriously injured? While insurance won’t solve every problem, it definitely helps alleviate some fiscal concerns.
And in a situation that is far less drastic, but still costly, emergency savings can make all the difference between being unable to put food on the table or repairing the car.
Review your insurance portfolio to make sure that your family is covered in the event of a possible disaster, and evaluate your bank accounts to ensure that you have an emergency savings plan in order to catch you in case you fall. And like the trapeze artist, let’s hope that you never actually need to use it.
About the Author: Douglas Goldstein, CFP®, is the director of Profile Investment Services, Ltd, a financial planning firm located in Jerusalem. He specializes in working with clients in New York, Florida, and Israel and is a licensed financial professional both in the U.S. and Israel. Securities are offered through Portfolio Resources Group, Inc., Member FINRA, SIPC, MSRB, SIFMA. Accounts held at Pershing LLC., Member NYSE/SIPC, a subsidiary of The Bank of New York Mellon Corporation. Neither Profile nor PRG gives tax or legal advice. Before immigrating to Israel, it is advisable to consult with a tax attorney who is knowledgeable about Israeli law. Doug’s newest book The Expatriates’ Guide to Handling Money and Taxes is available at www.expatguidetomoney.com. He hosts a weekly finance show, Goldstein on Gelt, on internet radio. Listen live or download podcasts. Toll-free from U.S. 1-888-327-6179, Jerusalem: (02) 624-2788. Follow on Twitter: @DougGoldstein or contact at firstname.lastname@example.org.
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