Before when Dani and I took the class, the first three of the seven "Baby Steps" dominated our to-do list—1. Get a $1,000 emergency fund in the bank, 2. Pay off all debt except the house, and 3. Put 3–6 months of expenses away in savings. Well, we've done all that. Now we're ready to start thinking about other aspects of the plan, things that, until now, have simply been lurking in the back of our minds.
Oi vay! Insurance. Nobody really likes spending money on insurance. It's basically something you pay for over and over and over again and hope to never actually need. However, when that major, unexpected something happens, we all suddenly love insurance—as long as we have the right kind.
Dave says there are seven key areas of insurance that people need to understand and get—like, immediately—if they don't already have them. They are:
- Homeowner's or renter's
- Long-term care (if you're over 60)
- Identity Theft
In the next couple months, Dani and I are going to be exploring these insurance types and trying to figure out how in the world we're going to pay for them on a budget that's already stretched pretty thin.
Last week's Financial Peace University lesson was about the role of insurance and it concluded with a heart-breaking story of a man named Steve Maness who died of brain cancer, leaving behind a wife and baby boy. Fortunately for Steve's family he had heeded Dave's advice and got the right insurance policies in place before he died. It was truly a wake-up call for us to get serious about the role of insurance in our lives. It's not fun to figure out, and it's financially painful to put in place, but it's all part of practicing good diligence.
Keep pinchin' :-)