Discussion

Tim J Bennett

Everyone will at sometime in their life have an emergency. It may be divorce, sickness, death, unemployment or some other sad moment, but for sure at these times you will without doubt need some emergency money.

If we know that at sometime in the future, we will be hit by such a terrible moment, does it not make sense to get ready for it with and Emergency Action Plan?

It does not matter if you are rich or poor at sometime you will need extra cash – even if it is for the downpayment of your new Aston Martin!

So what is an Emergency Action Plan and what are the 3 essential parts to the plan that you need to put in place?

An Emergency Action Plan is a pre-prepared document that allows you and your family to be ready for emergency. In this article I am referring to Financial emergencies, but in actual fact, you should have an emergency action plan for other situations as well.

So here are my 3 steps to putting together your Emergency Action Plan:

1) Make a list of all your assets, loans, jewelry, businesses, stocks and shares, debts, money in banks and any other financial elements in your life.

Do not forget to include debts and liabilities as well as assets.

2) Gather all essential documents, photos of valuables, passports, birth certificates, copies of dental records and fingernail prints and other identifying documents for all of your family members. Collect account numbers, addresses, emergency telephone numbers, signatories addresses, lawyers name and all other personal and important documents. Make a copy of everything and store the originals in a safe place.

3) Discuss with your family, what to do in case of emergency. Appoint someone to look after the family affairs in case anything happens to you.

Involve lawyers and accountants in the plan as your family may incur huge tax bills if you leave them property and other assets in wills. They are going to be struggling emotionally so no need to burden them with financial problems too.

This does not need to take long and should only incur minimal costs with your legal representatives.

All the original documents should be stored in a fire proof safe or with a bank safety vault. Obviously give the details of the boxes to someone else, just in case you are not around.

It would also be a good idea to store some emergency money in the safe just in case you need it.

Obviously this is only the tip of the iceberg when it comes to protecting your family and loved ones, but it is better to have a small plan than none at all and as time progresses you can allow the Emergency Action Plan to grow.

Do not forget that you may need, at least once a year, to update the Emergency Action Plan