Adulting can be hard – especially when you’re still learning all the do’s and don’ts of what it takes to be a responsible and successful adult. Now that you have been thrust into the adult world of wondering how to protect your assets, you might realize that no one ever explained the importance of financial planning and insurance coverage. It may seem like a waste of money at first because you believe that you and your belongings are invincible, right? But accidents happen every day, so it’s crucial to safeguard all of your assets.
This checklist for managing and protecting your assets will help get you on your way to full-fledged adulthood!
Asset Protection for Beginners
- Homeowner’s Insurance
This insurance protects your most valuable asset – your home. When you are ready to begin the search for the right policy for your home, remember that not all policies are created equal and you will get what you pay for.
- A standard policy will cover your home and personal possessions in the event of damage or a break in. It will also provide coverage if you have to live somewhere else temporarily or if someone injures him or herself at your home and sues you.
- When shopping around for quotes be prepared to compare costs, coverage quality and whether the company gives discounts for bundles such as home and auto.
- Financial Planning & Investing
Thinking about how to manage your finances can feel overwhelming if you aren’t sure where to get started. If you are hesitant out of fear, remember that it’s better to dive in and make a few mistakes along the way than to sit on the sidelines worrying about how to begin.
- Start with a financial inventory of all of your money and debt.
- Make a list of your goals and a basic roadmap of how to get there.
- Create a budget so you know where all your money is going and so you know how much you can invest.
- Look for a financial planning firm that fits your needs – whether it’s one for young beginners or even a company that caters to a specific demographic like Ellevest
- Take a deep breath because no matter what your financial plan is, it’s better than no plan.
- Jewelry Insurance
Quite often, people mistakenly believe that their fine jewelry is covered under a homeowner’s insurance policy. While that is true to a small extent, this home policy will not fully protect or cover the cost of these valuables and will only cover up to a certain dollar amount. If you want your jewelry fully insured choose a jewelry insurance policy.
- This insurance is affordable as it only costs 1-2% of the total value of the jewelry.
- By having this a separate policy, any claims will not affect your other insurance coverage.
- Jewelry loss and theft is not uncommon so this specific policy will keep you from paying out of pocket.
- Protect Your Home
Security systems have always been popular, but now they are affordable for everyone due to the new video doorbell systems on the market. Companies like Ring make it easy to feel safer in your neighborhood and give peace of mind when both at home or away.
- Estate Planning
This last step in safeguarding assets can be overlooked at a young age, but is extremely important if you will be transferring any assets to loved ones and want them to have the smallest tax burden possible. Steps to an estate plan include:
- Making a last will and testament
- Creating a financial power of attorney
- Having a life insurance policy
- Filing beneficiary forms
- Consider making a trust
- Covering funeral expenses
- Protecting your business (if applicable)
Protecting You and Your Loved Ones
Unfortunately, accidents and disasters can happen. Becoming a successful adult means preparing for many things that might not happen just to give you and your loved ones peace of mind. Be sure to insure yourself and your assets correctly so that you don’t find yourself in a tough financial situation before you really get off the ground.
- Adulting: What you need to know about insurance. www.autohomeboat.com. (Accessed Sept 8 2020).
- 12 Simple Steps to an Estate Plan. www.nolo.com. (Accessed Sept 8 2020).