Did you know that only 28% of Canadians feel financially ready? And by ready I mean ready to handle any of those unexpected life moments that can be financially strenuous (illness, disability, retirement, death, etc…).
Considering I’ve been blogging about everything personal finance for almost 4 years now, I was fairly confident that I would be in that 28th percentile, but I still wanted to be sure. So, I spent less than 2 minutes out of my day to take Manulife’s Readiness Quiz. Overall, the results were pretty much what I expected. I scored 85/100, which put me in their Readiness Level 1 category. Still, I didn’t get 100/100 and I think I know why. When taking the quiz there were two sections that made some alarm bells sound off in my head.
Am I Prepared If Something Bad Happens?
Although I’ve got an emergency fund, I’m investing for retirement and I’m fairly frugal in my day-to-day life, there are still some things I know I need to do to be more prepared for all of those worst case scenarios.
In the event that my husband or I get seriously ill, become disabled or die, we honestly aren’t as ready as we should be. It could be because I hate to think that any of those things could happen, or because I know getting disability or life insurance would require me doing my due diligence first and that means taking time out of my already busy life.
Not matter the excuse, I know we’re doing a disservice to ourselves by not figuring this out sooner rather than later.
I’m lucky in that I do have some disability and life insurance through my work, but Josh is self-employed without any type of insurance as a safety net. We both know having insurance for these types of scenarios is important — having experienced illness, disability and death in both our families — so I’m going to make this a priority for the remainder of 2015.
Do I Have a Plan for When I’m No Longer Here?
On the same note, and I know I mentioned this to Preet Banerjee in our podcast episode together, my husband and I also don’t have a will or power of attorney. It honestly wasn’t something we even thought about before we got married.
But after we got married, both were on my to-do list along with changing my last name. Well, I was able to change my name on everywhere, but I haven’t made much progress on getting a will or power of attorney. And we’ve been married for over 2 years now.
Again, this is something I want check off my list before the year ends. My whole platform in this personal finance community is about being savvy and responsible with your money, and I’m knowingly being irresponsible by not having insurance or a will.
How to Be Financially Ready
If you’ve taken the quiz, then you’ll have an idea of what you need to work on to become more financially ready, but I thought it would be handy to list the most important things below:
- Start an emergency fund (at least 3 months’ expenses)
- Pay off your debt (and set a specific deadline to have it paid off)
- Get disability insurance
- Get life insurance
- Get a will
- Get a power of attorney
Being financially ready to me is the same thing as being financially free. If you’ve got an emergency fund, you’re debt-free, and you’ve got insurance, a will and a power of attorney — you’re golden.
As I’ve explained a number of times on this blog and on my podcast, the reason why I’m so passionate about sharing my personal finance journey and helping others like you is because I want us all to live the best lives we can. I never thought I’d be able to afford the beautiful wedding I had, a month-long trip to Thailand or moving to Toronto without a job.
But because I educated myself, saved 50% of my income and was smart with my money, I realized that there were no limits to leading a fulfilling life.
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This post is sponsored by 360ACCESS on behalf of Manulife. The opinions are my own.