Life-changing disasters can strike at any time and any place playing havoc with the best-laid financial plans. These disasters can happen quickly and unexpectedly, forcing you to deal with situations at a time when you may not be thinking clearly.

Advance planning will not eliminate these disasters but certainly will make dealing with them a lot easier. A good financial plan is built around saving and acquiring assets, as well as protecting your assets. As well as investing for retirement, you need an emergency savings fund that can be accessed easily in case of a disaster. Without a good financial plan, a disaster can wipe out your savings and ruin your retirement plans.

In addition to saving, you can protect your assets by taking a look at your insurance needs, reviewing your will or preparing one if you don't have one, and organizing your financial files.

Insurance needs are often underestimated. Do you have disability, life, health and homeowners/renters, or auto insurance that will provide enough coverage in the event of an accident, death, illness, or natural disaster? Making an inventory of all your assets will help you determine the coverage you need.

Wills need to be reviewed and updated every five years or when you acquire new assets or in case of divorce, death, or other life changing event. Make sure that the will clearly states how you want your assets divided upon your death.

Organize and keep up-to-date files about your financial information. Make sure your spouse, adult children or other responsible person knows where to find the files and understands your filing system. They should also know where to find the safe deposit box key. If you are among the people who keep all their files on a computer, make sure that you keep a backup copy of important files and that someone knows where to find your password in case you are not able communicate.

An emergency savings fund, appropriate insurance, wills, and organized files are all important components of a good financial plan. Protecting your assets is important to ensuring your financial security and minimizing the financial impact of disasters and other life-changing events.

For further information about protecting your financial future, visit the Plan Well, Retire Well website at www.RetireWell.uiuc.edu.

Source: Pat Hildebrand, Extension Educator, Consumer and Family Economics

Effingham Extension Center, University of Illinois Extension

(217) 347-5126