We all face a variety of emergencies in our life that could prove to be financially devastating. The first block of our foundation starts with survivorship needs, or to be more precise, the needs associated with death. There are two fundamental needs associated with survivorship. First is the need to provide an income stream to your surviving family members. The second block pertains to the financial needs resulting from an unexpected disability.
Disability is the most often overlooked piece of the puzzle, second only to long-term care.
What people fail to realize is that disability can be even more financially devastating than death due to the continued consumption by the disabled person, as well as the increase in expenses due to medical bills. Last, but certainly not least on the emergency tier, is the emergency fund. It is crucial to have adequate liquid funds available to take care of immediate financial needs in the event of an emergency. I refer to the second tier as the accumulation tier. The two blocks in the accumulation tier are education funding and retirement funding.