How to Hit a Financial Planning Homerun
By (ARA)
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(ARA) - The crack of the bat. The roar of the crowd as you round the bases. While hitting a homerun in the big leagues is only the stuff of dreams for most of us, baseball can serve as a wonderful analogy for our quest for financial security.
Reaching retirement, or home plate, is the goal. So step up to the plate, take a swing and round the bases with these general, yet timeless, financial tips from Thrivent Financial.
First Base
Get on base by:
* Creating an emergency cash fund with at least three to six months worth of living expenses set aside. This fund is essential to cover unexpected short-term expenses, like a major car-repair bill or broken furnace. Keep the funds safe and accessible in a savings or money market fund, and be sure to replenish the fund later if you draw from it for an emergency.
* Purchasing property insurance that protects you and/or your business against the loss of the property or income. Auto, homeowners and business owner policies fall under this category.
* If your employer does not provide health coverage, buy your own. You can't afford to be without it. "If you fall ill and have to be hospitalized without health insurance, you will quickly realize that the cost of not being insured far exceeds the cost of premiums," says Bruce Fear, vice president of Protection Products and Solutions for Thrivent Financial.
Second Base
As you head to second base you're approaching the middle part of your life and earnings potential. Second base is about protecting your income from a long-time illness or injury, or the death of a loved one.
* Investigate disability income insurance. It's easier and cheaper to get when you're younger, and provides a benefit to replace a portion of your income if you become too sick or injured to work. It protects your most important asset -- your ability to earn an income.
* Life insurance is also essential. It protects your loved ones against the loss of income they would experience if you died. There are two main types -- term and permanent. Both help preserve the lifestyle of your surviving family members, but permanent can also allow you to accumulate a cash benefit.
Third Base
Third base is about protecting your hard-earned dollars, the assets you've accumulated for retirement or other financial goals. As you head to third, consider what types of events can lower your probability of rounding third and heading home. Two key items you should consider:
*Investigate medical insurance. While many companies provide medical insurance, once you retire, the coverage usually ends. And, if you aren't eligible for Medicare you'll need to consider individual medical insurance. If you're eligible for Medicare, keep in mind it won't cover all your health-related expenses in retirement. Supplemental insurance can cover the gaps.
* Long-term care insurance should also be on your mind at this stage. The coverage can provide for necessary medical or personal care services provided outside a hospital setting, such as in a nursing home or your own home.
Reaching Home
Covering all of the bases over time will help you reach home plate -- protecting your retirement plans.
* Estate planning is a key element of retirement planning. This is the process of working with your legal, tax, and financial professional to arrange your financial affairs so that you have sufficient assets to meet your lifetime needs, while ensuring that your wealth will be distributed according to your wishes after your death.
"A stable, solvent retirement in which you can maintain the standard of living you enjoyed while you were working is the equivalent of hitting one out of the park," says Fear. "With a little bit of planning, the goal can be within reach."
Visit www.Thrivent.com to learn more about retirement savings, investing and tax planning.
Courtesy of ARAcontent
