As humans, we think, perhaps subconsciously, that whatever we are experiencing now we will continue to experience. That is why when people work overtime for a long enough period of time, they quit being careful with that extra money and instead allow income creep to take place. They go out to eat more frequently, they buy themselves more clothes and some treats such as a comfortable recliner chair. When the overtime ends and they go back to their old salary, suddenly they can no longer make ends meet.
Mortgage Insurance Offers Protection
This is also why people do not take out insurance that may help protect them. If you are planning to become a homeowner or are one now, do you have mortgage insurance?
While life may be fine right now, and you have enough money to make ends meet plus put money away, what if your circumstances change? What if you lost your job or got sick with a serious disease such as cancer? How quickly would you run through your savings? What if you are injured and are no longer able to perform your job?
Your situation can change in less than a minute. Dawn, a Genworth employee who assists those with mortgage insurance who are experiencing difficulties paying their mortgage, explains how she can help people stay in their homes.
When your life changes drastically, the last thing you want to worry about is losing your home, uprooting your family and having to move.
Other Types of Insurance to Protect Yourself
The Huffington Post also mentions several other important types of insurance that you should have, especially if you are the head of household or your family relies solely on your income.
Disability Insurance–If you are a full-time employee, this insurance is likely one of your benefits. However, more and more people are self-employed and own their own business or freelance. For instance, if you are a writer, what if you sustain a head injury and are unable to work for several months? You will have no money coming in unless you had the foresight to take out disability insurance.
Long-Term Care Insurance–Again, if you are injured and need someone to come to your house to care for you, that care can be very expensive. Long-term care can help you pay these expenses while getting the quality care you deserve.
The old saying is prepare for the worst, hope for the best. If you are diligent about taking out the appropriate insurance for your situation as well as having an emergency fund, you should be able to handle most difficult financial situations that come your way.