No one expects bad things ? and by bad, I mean catastrophically bad ? to happen to them.
Yet terrible tragedies happen to people who didn?t expect them every day of the year.
You can?t take a vaccine to immunize yourself against ill fortune.
But you can prepare for disasters before they happen.
That way, when they strike, you ? and your family ? will survive ? with the minimum hardship possible.
In particular, here are 5 things I think you should do now to protect yourself against future problems and headaches:
1. Become financially secure.
Money can protect you against many disasters, and make many others easier to bear.
How much wealth should you strive to accumulate?
I recommend a goal of $2 million in liquid assets.
Reason: $2 million invested at 10% annual return produces an income of $200,000.
If a catastrophic illness or other crisis prevents you from working, you can just live off your investments.
And if your business fails or your career derails, you likewise can live off your investment income.
2. Buy life insurance.
Until you accumulate the $2 million, you need to leave an estate big enough to ensure a comfortable life for your family ? preferably, without forcing your spouse to sell the house and make the kids move.
Although a $2 million estate would be ideal, your spouse can probably get by nicely even with a million dollars in term life insurance on you.
Tip: buy this life insurance while you are young, before you have a serious illness.
Should you get sick, and then decide to get life insurance, the cost will be prohibitive.
3. Buy health insurance.
More than 46 millions Americans do not have health insurance.
They are gambling their family?s entire financial future.
One serious illness can quickly wipe out your life savings.
Get health insurance now. If you can?t afford a private policy, join a group that offers discount coverage to members.
Tip: buy your insurance first. Then select doctors from the HMO?s list of approved physicians.
That way, your doctor visits are covered by your plan, greatly reducing your health care costs.
4. Create sources of passive income.
What happens if you injure your back ? or get a debilitating illness ? and can?t work?
Disability payments are often limited.
A better idea is to start creating sources of passive income now ? sources that make money for you without you working.
One idea: investment real estate ? rental properties.
Another: start an Internet marketing business that generates thousands of dollars in weekly revenues without any activity on your part.
Here?s a Web site where I discuss how you can make a six-figure passive income online with your own Internet marketing business:
5. Live for the moment.
This may seem contrary to the idea of ?prepare for the future.?
But it?s really not.
When I was young, my father did not earn a high income, and constantly worried about money.
Yet my mother ?forced? him to take at least one nice week-long vacation a year.
By some standards, these were far from ?luxury? vacations ? although they were very nice — but the cost certainly made him nervous.
Eventually, my father became ill from a cancer that would cause his death at a too-early age.
But by then, both he and my mother had a lifetime of great memories from their travels all over the globe with family and friends.
Had he waited until retirement, they wouldn?t have shared those memories ? because he died before he was able to quit working.