Financial Literacy Month: How Insurance Can Protect Your Assets
Living life can be expensive. You have your home, your car, and all your stuff. There are bills, loans, and payments for every kind of product and service out there. It’s up to you to protect it all.
As the savvy consumer you are, you know that things happen all the time and you want to make sure you’re covered. Here are three kinds of insurance you need to protect your assets in almost any situation:
Home insurance protects your stuff
Home and renters insurance is the kind of coverage you want to have, no matter your personal situation. Even if you’re a poor student, stuff can get expensive if a pipe bursts in your building and floods your apartment. You don’t want to pay out of pocket for that $2,000 laptop that has been your school-related lifeline for the past few years.
If you own property, the stakes are even higher. Buying a good home insurance policy for your condo or house can make all the difference between something being a manageable problem versus a complete crisis.
For instance, we had a two-minute hail storm last summer and the damage to our home cost over $20,000 to repair. We had a good policy so insurance picked up the tab. Without it, we would have been in real financial trouble.
Life insurance saves your estate
Life tends to get more complicated as you go along. You might start collecting partners, property, and offspring that you’ll want to protect if something happens to you. Even if you’re younger, all those student loans can become a problem if a piano falls on you and your parents have to push back retirement 10 years to pay off all the extra debt.
Pick up a good life insurance policy that fits your personal situation so that all your loved ones are protected if something goes sideways. Make sure you designate your beneficiaries and ensure its enough to cover a mortgage, car payments, any extra bills, and a couple years of wages so that everything is looked after with minimal financial drain on your family.
Liability umbrella insurance reduces other risks
Liability umbrella insurance is the “what if” coverage of the world. This is something you add on to your existing home insurance to protect you against injury claims, property damage, rental property problems, and more far-ranging issues like libel, slander, and other random wrong-doings.
You know those annoying salesmen that come to your door? Those guys can sue you if they trip over a sidewalk crack and injure themselves on your property. Liability insurance is exactly the kind of coverage you need for sleazy sales guys bent on legal domination. It’s one of the best ways to protect your assets as your net worth goes up.
This is also useful if you rent out a room in your home, are employing contractors on property, or want to have a large party like a wedding in your backyard. It saves you from big legal bills and protects your assets if something goes wrong.
Insurance premiums might be a pain to pay, but it’s far more painful in the end if you have to drain your
accounts to pay out of pocket for the unexpected. Good financial planning includes the ability to protect your assets with the help of the right insurance coverage.