April is Financial Literacy Month and in this week’s installment, we are going to discuss how to protect your cash flow. Joining us once again is Matthew Gunter, Managing Associate at Financial Growth Partners, to provide us with his insights and expertise.
In previous conversations, we’ve talked about having a great savings plan and allocating money to a debt strategy. However, to ensure these plans work, we need to maintain active cash flow. But, what can potentially stop cash flow and how can we prevent any threats to our financial plan?
Protecting Your Assets
One of the first things to consider is protecting your assets through property and casualty insurance and owning an umbrella policy. While property insurance covers things like your house catching on fire or acts of God, it also covers things like your friend falling and getting hurt while visiting or if your dog bites someone. An umbrella policy provides additional coverage, so if someone sues you and your policy doesn’t cover enough, your umbrella policy can help make them whole. While this may seem like a simple add-on, it can save you from potential lawsuits that could compromise your financial plan.
Reviewing Your Will
No one likes to think about their mortality, but it’s important to ensure that your assets will be distributed according to your wishes in the event of your passing. That’s why it’s crucial to review your will periodically, at least every five years, to ensure it reflects your current desires. You’ll want to consider who will inherit your assets, including your retirement accounts, insurance policies, and other financial assets. This is particularly important if you have children, as you’ll want to specify who will raise them in the event that you’re no longer able to.
Trusts and Taxes
If you have a substantial amount of assets, it may make sense to establish a trust. A trust can provide tax benefits and help protect your assets from creditors. Speaking with an attorney who specializes in trusts and estate planning can help you determine if this is a good option for you. This may be vital for you to protect your cash flow.
Conclusion
Protecting your cash flow is an important part of any financial plan. Ensuring that you have adequate insurance coverage, reviewing your will, and considering a trust if you have substantial assets are all steps you can take to safeguard your financial future. Don’t wait until it’s too late to protect your assets – take action now to ensure your financial plan works in all conditions. If you need help with any of these steps, don’t hesitate to reach out to a Matt at Financial Growth Partners.
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