Whether you like it or not, preparing for the unexpected is an essential part of life. It’s how you set yourself up for success at home and at work. It’s how you protect yourself and your loved ones. It’s how you get by when times get tough.
Over the past 18 months, the COVID-19 pandemic has drilled this home time and time again. And in many cases, it all comes back to our finances.
Make these five money moves today to better prepare yourself and your loved ones for the unexpected — and find greater financial peace of mind.
1. Protect your income for as little as $9/month
The Social Security Administration estimates that 25% of Americans will experience a disability that prevents them from working for at least 3 months before reaching normal retirement age.
Yet just 1 in 3 applicants for Social Security Disability Insurance (SSDI) are approved and the average monthly benefits is only about $1,200 per month.
So, what would happen if you became too sick or hurt to work? Without paychecks coming in, how would you pay bills, take care of your family, and meet all of your other financial obligations? You can only live off savings for so long…
With disability insurance, you won’t have to worry so much. Disability insurance is protection for your greatest asset — the ability to earn an income. If you become too sick or hurt to work, your policy will replace a portion of your monthly income while you recover.
Breeze makes it easy to buy affordable disability insurance online. Get a personalized quote in 30 seconds, apply for a policy online in 10 minutes, and receive same-day coverage if approved. Get a free quote from Breeze.
2. Fill the gaps in your health insurance in 10 minutes
Does your health insurance fully cover cancer and other expensive illnesses? Most plans don’t, so you should double-check.
After all, getting hit with a large, unexpected medical bill can wreak havoc on your finances if you have gaps in your health insurance. In fact, two-thirds of all personal bankruptcies in the U.S. are tied to health issues.
Whether you’re worried about a high health deductible you can’t afford or a family history of cancer, critical illness insurance can help. Critical illness insurance is supplemental coverage for cancer, heart attack, stroke, and other life-threatening conditions. If you are diagnosed with a covered illness, your critical illness insurance policy will pay you a direct lump-sum benefit to help with out-of-pocket medical expenses like deductibles and copays, as well as household expenses, monthly bills — literally whatever you need.
Breeze also offers affordable critical illness insurance coverage through its simple online process. Check your rates with Breeze.
3. Leave your family a $1M legacy
Have you thought about how your family would manage without your income after you’re gone? Chances are your checking account balance won’t last forever.
Here’s the thing: You should keep a healthy amount of savings in the bank, but if you want to give your family up to $1 million, use something called term life insurance.
We suggest a company like Bestow. Maybe you’ve considered this before, but thought it was only for rich or older people. But we’re hearing that people are getting it for as little as $16 a month.
You can take advantage of Bestow until you’re 54 years old, but the sooner you take care of this, the cheaper it could be.
You don’t even need to leave your house to get a free quote from Bestow — it takes minutes. Instead of leaving your family with what’s in your checking account and a bucket of worries, they’ll be able to afford the life you’ve always wanted for them.
4. Stash cash for unexpected emergencies
One of the easiest ways to lose control of your finances is to be unprepared for unforeseen events. In fact, 60% of Americans don’t have enough savings to cover an unexpected $1,000 expense.
An emergency fund is money set aside to help you through unexpected events that can hurt you financially. Having an emergency fund can improve your financial security and minimize the stress of a job loss, temporary disability, or major repair.
Without an emergency fund, you may live in fear of crisis. And if an adverse event occurs, an emergency fund can protect you from having to use credit cards, take out loans, borrowing from your retirement account, or asking friends or family for help.
But an account with Aspiration lets you earn up to 16 times the national average interest on the money in your account. And it will earn you up to 5% back every time you use the debit card.
Enter your email address here to get a free Aspiration Spend and Save account. After you confirm your email, securely link your bank account so they can start helping you get extra cash. Your money is FDIC insured and they use a military-grade encryption which is nerd talk for “this is totally safe.”
5. Write a last will and testament online
A number of websites let you create a last will and testament online for $100 or less. You’ll typically only want to use these products if your estate is relatively simple, i.e., your assets are limited, you don’t have a child with special needs or estranged family members who are likely to contest the document. A few options include:
- Nolo’s Quicken WillMaker & Trust 2021, $99. Includes over 35 documents, including a will, living trust and health care directive. Documents aren’t valid in Louisiana, U.S. territories or Canada.
- Rocket Lawyer, $39 per document for nonmembers or $39 per month for membership. Some attorney services are also included with the membership.
- Willing.com, starts at $69 for online wills. For more information, check out our full Willing.com review.
Note that if you have minor children, it’s well worth the cost to spend money on an attorney. You need to make sure that your plan for their guardianship is airtight. Also, minors can’t legally take ownership of property until they reach the age of majority, which is 18 to 21, depending on your state, so you’ll want an attorney who can determine the best way to structure any potential inheritance.