Throughout your life you are likely to face one or more of these financial crises. But perhaps a crisis is really an opportunity. To write the Chinese word for “crisis,” you combine elements of two different Chinese characters. One character means “danger” while the other one means “opportunity.” Translated into English, it means “opportunity riding on a dangerous wind.” Here’s how you can pivot and plan for your future amidst a crisis turned opportunity.
(Click the featured times below to jump forward in the episode)
1:01 – Crisis #1 – The Empty Nest.
- After an adjustment period, this might not really be a crisis. It’s a great time to use that last 5-15 years before you retire to do some catch-up on retirement savings. Your food bill, car insurance, and college costs are all lower now, which means you have more money to invest.
2:52 – Crisis #2 – Market Crashes.
- Crashes generate a lot of emotion when looking at your financial statements. Of course, you don’t want a market crisis to affect your ability to retire. Everyone knows the saying, “Buy low, sell high.” But you can’t buy low if you didn’t sell high. It’s really difficult, but the opportunity comes at the bottom. We use a set of triggers to tell us whether the market is in an uptrend or a downtrend, which identifies major turns in the market and where you might find opportunities.
5:36 – Crisis #3 – Your Long-term Care Insurance Policy Sees A Rate Hike.
- If you get a rate increase right around the time when you need your long-term care insurance, you’re often faced with a choice of paying the increased price or accepting a reduced benefit at the same price. You may consider pursuing long-term care protection early on for yourself to avoid this situation.
7:45 – Crisis – #4 – You Get Laid Off Or Are Forced Into An Early Retirement.
- There can be a silver lining to that if you get a severance package or lump sum which would enable you to live the way you want to in retirement. Putting your plan on paper helps you determine how that lump sum can be turned into retirement funds. Meeting with a professional and getting a plan helps you see how it’s possible.