In my columns I often advise people to take the time to plan for the unforeseen. This week I have a personal story about something that happened to me last week that will hopefully serve as motivation to some of you as well.

One week ago Friday I took my two sons along with a couple of their friends down to a small creek behind our house to play. This is something we have often done during Covid. However, this time as I was climbing down the small incline into the creek area, I somehow slipped, fell headfirst into the water and suffered a serious head injury. In what I can only describe as divine intervention, I never lost consciousness and was able to make it back to a populated area were paramedics were able to reach me. After an emergency surgery I am pleased to report that I am recovering well, and hope to be back to 100% soon.

As difficult as this situation was, it would have been exponentially worse had my wife and I not had plans in place for just such a tragedy. With things like an emergency fund, insurance policies and a will in place, it brought me great peace knowing that if something tragic happened and I did not survive, my family would be taken care of.

As my wife and I waited in the emergency room for the trauma surgeon, we discussed many things, like what account balances were, where important documents could be found etc. But the difficult decisions had been made long before this accident.

Can you say the same if something happened to you? If not, please take my advice and start the process today, especially if you have young children.  Perhaps the hardest part of planning for a tragedy is knowing where to begin. While these steps are by no means all-encompassing, and every situation is different, these are just a few things you can do to be better prepared.

  1. Make sure you have health insurance and enough in an emergency fund to cover your deductible. I know I have said this many times before but I cannot emphasize enough the importance of having 3-6 months’ worth of expenses in reserve for when a tragedy occurs. Without it, a medical crises quickly becomes a financial crises. These money issues can then lead to variety of other problems including, divorce, mental illness, addiction and even suicide.
  2. Have written directives in place so that your final wishes are never left unclear, or up to chance. While it is best to work with a lawyer when putting together your estate plan documents, the internet has made the entire process easier and less expensive than it once was. There are several elements that should be part of most plans. It should identify who will take custody of any minor children in the event of your death, it should determine who will be the recipient of your assets. It should grant an individual power of attorney to act on your behalf should you be incapacitated, and it should provide medical and burial directives to insure your final wishes are carried out.
  3. Possess enough life insurance and long-term disability insurance that those dependent on your future income are not left in financial distress. Particularly if you have dependent children, this can be the most important step I will list today. A good rule of thumb for how much life insurance you need is 10x your annual income. This of course varies based on how much debt you have, how many dependents you have and how long they will remain dependent. The same can be said for long term disability. You really need enough in place that if you were unable to ever work again you would be able to continue to have the income required to support both you and your family.
  4. Make sure all of the beneficiaries on your retirement and bank accounts are current and up to date. This is such a simple thing to do, yet it is so often forgotten. Life changes occur, and unless you adjust your beneficiaries accordingly, families can find themselves torn apart because the wrong people become benefactors to your estate.

Life is full of surprises. I am lucky to be able to say I’m living proof of that. Before an unexpected surprise happens in your life, take a couple of minutes to think about what would happen if something happened to you. Your loved ones deserve to know you have a plan.