Thinking about Some financial steps to safeguard our future? Every age and every situation in life has different demands on private financial planning.
Unfortunately, there is no all-round carefree package because insurance protection and the investment for old age should always be adapted to the respective living conditions. We give tips on what you should pay attention to. Here are Some financial steps to safeguard our future.
Risk protection
Securing against financial ruin is an important part of private financial planning. This usually occurs when the income drops due to a termination or an accident. So that the entire existence of a family is not threatened, it is therefore advisable to take out appropriate insurance at an early stage. The following options are available:
Risk life insurance: This insurance is used to provide financial protection for family members in the event of death. Another variant is the residual debt insurance, which in the same case would pay the remaining installments of a loan taken out.
Disability insurance: If someone is no longer able to perform 50% of their current job due to illness or an accident, they receive the disability pension. You should choose the amount so high that you can continue to pay your current expenses household costs, loan installments, reserves and savings rates for old-age provision in the event of disability.
Private liability insurance: In contrast to motor vehicle liability insurance, private liability insurance does not necessarily have to be taken out. Nevertheless, this insurance is recommended because it covers damage caused by the insured to the property of others. The insured sum should be at least 50 million dollars.
Residential building insurance: important for all property owners. In the event of storm damage caused by fire, lightning, storm and hail damage, building insurance reimburses the costs of the repair up to the reconstruction after total loss.
Pay off debts
Before you can take care of your retirement savings, you should try to pay off any debts. As a rule, you have to pay high interest on your debts: with an installment loan it is between four and eight percent, with an overdraft facility up to 18 percent. If these debts disappear, you automatically save a lot of money.
Build up reserves
So that you can provide for old age in the long term, you shouldn’t neglect the present. Because unexpected costs quickly tear a hole in the household budget having to go into debt or even take out a loan is not expedient. So make sure that you build up reserves in good time. For this, we recommend securing money of at least three monthly salaries and investing it at any time. You should never invest this nest egg in a risky or speculative investment – the risk of losing everything is too great.
