STEP 1: INSURANCE PLANNING
The first step in putting your financial house in order must be to ensure that you are properly protected with life, disability and critical illness insurance. However, the same way that you would not purchase car insurance if you don’t own a car, or house insurance if you don’t own a home, you should not purchase life, disability or critical illness insurance- unless you need it.
No matter what you have been told, there is one reason and one reason only, for buying insurance: to protect against a financial loss. If there is no potential for financial loss, you simply don’t need insurance.
Before getting caught up with the morass of the insurance industry, ask yourself three basic questions:
- WHY do I need it?
- HOW MUCH do I need?
- WHAT TYPE should I buy?