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Blueprint 4 Greenbacks

Blueprint 4 Greenbacks

Uncle Todd's Money School

  • Organize Finances
  • Plan and Track Goals
  • Reduce Spending
  • Save and Invest
  • Maximize Income
  • Protect Assets

Step 18: Carry adequate insurance

2023-10-02 by Uncle Todd 22 Comments

Building wealth is a lifetime process. Use Insurance to protect your hard work from danger. Building your fortune is like a game. Play good offense (make a lot of money) and good defense (spend little and protect what you have). 

  • Protect your largest assets
    • home (house insurance)
    • car (auto insurance)
    • income (disability, medical, and life insurance)
  • Managing risk is essential to your long-term financial security. The point of having insurance is to protect from financial catastrophe. Buy only enough insurance to cover expenses you couldn’t make out of your own pocket.
  • It’s imperative to buy insurance when you don’t need it, because when you do need it, you can’t get it.
  • “You want to do business with a company that will be around for years to come – one that will be there if you ever need it.” 
  • car & homeowner’s
    • Select the highest possible deductible on your auto and homeowner policies and do not submit small-dollar claims.
    • Choose replacement-cost homeowner coverage and keep a current inventory of your personal property in a safe-deposit box.
    • Maintain your auto and homeowner policies with the same carrier and buy an umbrella policy from that carrier.
  • Medical insurance is the most critical insurance to have in some peoples estimation.  That is because the primary cause of bankruptcy in America today is because of medical catastrophe. 
  • disability
    • During your working years, carry long-term disability insurance equal to at least 60% of your gross income.
    • Pay the LTD premiums with after-tax dollars so that you receive any benefits tax-free.
    • At least 10 years before retiring, buy a long-term care policy with inflation protection. Pay the LTC premiums from your health savings account.
  • life insurance is particularly important if you have individuals that are dependent on you for survival.  If not, it may be unnecessary.
  • Insurance is complicated.  Consult with a trusted professional to secure the right coverage.  (Ask your parents, friends, or co-workers for recommendations on insurance agents.) Reduce insurance expenses. 
  • Shop around.  Review coverage annually to check rates, applicable discounts, adequate coverage and adjust for lifestyle changes.  

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Filed Under: Insurance

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