The Personal Finance Podcast - How to Create a Bulletproof Wealth Protection Plan

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Starting point is 00:00:56 Find your advisor at IG Private Wealth.com. On this episode of the personal finance podcast, we're going to talk about how to create a bulletproof wealth protection plan. Welcome to the personal finance podcast. I'm your host, Andrew, founder of mastermoney.com. And today on the personal finance podcast, we are going to be talking about how to create a bulletproof wealth protection plan. If you guys have any questions, make sure you are on the master money newsletter and respond when we send out those newsletters. and you can ask me a question via email. And don't forget to follow us on social at Master Money Co, TikTok, Instagram,

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Starting point is 00:02:26 and you'll get original content. There's a bunch of extra things we talk about as well. In addition, we talk about current events and what's going on in the financial news that would actually impact your dollars as well. So today, this is an incredibly important episode. I am so excited to show this episode with you guys because we are going to be talking about how to create a bulletproof wealth protection plan. And this is so important because of a few reasons.

Starting point is 00:02:49 One of which is you want to be able to protect your income as you start to earn money. And being able to protect your income is the way that you can make sure that you stay on track over time and that you can continue to build wealth over time. Because doing this, making sure you protect your income, means that you don't have any roadblocks ahead where if you're not earning income or money's not coming in, you already have the plan in place so you don't have to stop investing. You don't have to have stress with money. You don't have to have anxiety with money.

Starting point is 00:03:17 Instead, you have this plan in place to protect your dollars. In addition, building out this plan means that you don't have to interrupt compound interest unnecessarily. What do I mean by that? See, what a lot of people do is that they don't have an emergency plan in place. They start to spend their dollars that they have invested that should be there to help them build wealth, that should be there to help them get freedom from their job. And instead, they use that money and draw down on that money because that's the only money they have. This helps you avoid doing that because what I'm going to show you today is we're going to build out a wealth protection plan that has layers to it.

Starting point is 00:03:53 There's levels to this thing. And what we want to be doing is as we have these layers in place, maybe the first two layers or the first two levels, you have to spend some of those dollars, but your wealth is still protected. We used to have multiple layers left if something else happened. If you had a catastrophic financial event, this is going to be all the layers you want in place to be able to have the most fortified financial situation. that you possibly can. And so we're going to talk about options we've never talked about on this podcast before, which is going to be really cool. So the first couple are going to be stuff that you've heard before on this podcast.

Starting point is 00:04:23 And after that, we're going to be talking about some really deep dives into how to protect your wealth and some things that you really need to be doing if you're not doing them already. And that's why I'm so excited because we're going to have beginner strategies here. We've got advanced strategies here. And you should pull these out and start working on these in order so that you can start to build up this wealth protection plan. Because if you want to make sure that you are continuing to build wealth over time, You want to make sure that your income is protected.

Starting point is 00:04:47 You want to make sure that your investments are protected. This is the way to do this. And in addition, in a couple of weeks, we're going to be coming out with another episode teaching you how to protect yourself online as well so that you can protect your credit score. And we're going to talk about it some in here as well, so that you can protect your credit score,

Starting point is 00:05:03 so that you can protect your identity and all those different things as well online. So making sure that you have all of this set up is going to make your financial life so much easier. And this is not a difficult. thing to set up once you do it and you start to get it moving, the system's rolling into place, you don't have to worry about it again because you can automate most of this and be able to not have to think about it again. So I'm so excited to share this with you now. Let's create that

Starting point is 00:05:28 bulletproof wealth plan together. All right, so the first three are what we're classifying as the basics here. And what we're going to do is we're going to talk through the three basics and then we're going to get into some advanced strategies as well. So the first one is you want to be able to protect your number one source of income, which is your day job. What happens a lot of times is when recessions roll around, a lot of people who have not fortified their day jobs are at risk of losing their job because what they do is they cut the folks that are not producing enough or if you are very green, meaning very new to that company, then they may cut those folks as well. So you want to protect your day job at all cost. How do you do this? Well, some of the basics are you want to be on

Starting point is 00:06:08 time. Being on time is how to be a good employee 101. If you're late all the time, that is one thing where they're going to notice it over time. You want to avoid gossip. See, gossip in the corporate world specifically, but in any situation gets you into a lot of trouble. And this is something maybe a lot of people won't talk about, but avoiding gossip specifically in the workplace is going to be something you definitely want to be doing. I have seen so many people get in trouble because they've been gossiping and somebody tell somebody and then they run into all sorts of issues. want to protect your job, keep your mouth shut. Number three is you want to add skills.

Starting point is 00:06:42 So the big thing that I talk about and one of my favorite things to do is look at the people that are the level above you. How did those people get to that level? For me, specifically, when I worked in finance, they had amazing Excel skills where they could create reports in Excel that nobody else could create. In addition, they were really good at networking with other people. So they had a big network at the company and outside of the company so that they could actually produce and make more money for the company. In addition, make the company more productive.

Starting point is 00:07:12 What about certifications? Can you add certifications that will allow you to be a stronger employee? Maybe, for example, you're a project manager. Well, if you're a project manager, there's a number of project management certifications that you could go out and get. Maybe you're a nurse, for example. Could you become a nurse practitioner? There's so many different things that you can put into play to add certifications that are going to allow you to help fortify your job. Now, Certifications A, maybe they'll teach you some things, but in addition, they just give you additional credibility specifically when you're working at your job. The next one is to take on projects, especially big projects.

Starting point is 00:07:47 If there's big projects coming out, big moneymakers for the company, maybe you take the lead on some of those projects and meet with your boss and say, hey, what projects can I take on to help this company increase profitability? And maybe you can talk about getting a raise and using our system to do that as well as you go throughout this process. And so thinking through all of these things, what can you do to fortify your job? Specifically, if you are brand new to a company, if you're in your early 20s, you got your first job, you're an entry-level job, what can you do to fortify that? That's the big thing that you need to be doing because as we see, when recessions loom and recessions come about, cuts have to be made.

Starting point is 00:08:22 And when cuts have to be made, you want to make sure that you are the most secure person in your department. You are working the hardest. You're on time. You have those skills. You have a great network around you. So building that now is the thing that you definitely want to do. You definitely want to do it with everything as calm. Because when the tide goes out, you don't want to be caught swimming naked.

Starting point is 00:08:41 And that is the biggest thing to understand is fortify your job and your number one income source now. Number two, the second thing is building up a cash buffer. Now, a cash buffer is basically your first line of defense when something happens in life. So a cash buffer is your quick cash that you have access to you. So for me, I keep my cash. in the savings account where my checking account is. Now, what is your cash buffer? This is the cash that you have in play,

Starting point is 00:09:10 and the way you want to save up for it is look at three insurances, your auto insurance, your health insurance, and your home insurance. Which of those three have the highest deductible? Maybe, for example, your health insurance has a $5,000 deductible. You have a high deductible plan, and maybe your home insurance has a $3,000 deductible, and maybe your auto insurance has a $4,000.

Starting point is 00:09:33 deductible. Well, in that situation, your health insurance is going to be the one that you want to save up to. So if it's a $5,000 deductible, you want to have $5,000 in your cash buffer plan. Why do this? The reason why we do this is because if something happens in life, you're going to at least have the cash available for the big three things that could happen to you to be able to cover that expense and an insurance will cover the rest. So making sure you have enough to cover your highest deductible within that account is going to help you fortify your first line in defense when things arise. In addition, you can use this cash buffer for other things as well. You can use it as your pre-emergency fund if something happens in life. That is what it's there for.

Starting point is 00:10:15 Now, Dave Ramsey is famous for when he talks about the baby steps to save up your first $1,000. This is that, but extended out so that you are actually safer than just having your first $1,000. Everybody knows you have to have cash on hand to be safe when it comes to your personal finances. And the next thing we're going to talk about is the main one that a lot of people hear about. But these first two line of defenses are going to help you protect your income and protect your savings so that if anything happens, these are the two basics. Now, the third one is the emergency fund. The emergency fund is not your cash buffer. These are two separate things. But the emergency fund is where you are

Starting point is 00:10:48 saving up for expenses, three to six months expenses to be exact when you're starting off, so that you can fortify your financial life if you lose a job or if something drastic happens to you. And the emergency fund is broken up into a couple of different phases. So the first goal you should have is at least three months expenses. The three months expenses comes into play. And the reason why we do three months is because if you lose your job, you at least have a three month runway to be able to go find another job. That should be your first fortification. But I like to have more than that. I like to have six months of expenses. The reason being is it takes some time to find the job that you want if you lose a job. And six months gives you that six months runway to be able to do it. Now, if you work in a

Starting point is 00:11:29 field, something like a software developer. Well, software developers are in really high demand right now. Or maybe you're a project manager. Well, PMs are really high demand right now. So in those types of jobs, you'll be able to find a job very quickly if you lose your job. But if you're in a type of situation, maybe you're a lawyer, for example, and you work for a law firm, where there are more lawyers graduating than jobs available that are out there. So if you're in that type of situation, you want to have a longer runway so that you can

Starting point is 00:11:56 find a right job for you. And specifically, that is kind of the rule of things. thumb here. Starting off, you need to target three months if you can find a job really quickly, and six months if you think it's going to take you longer to find a job. I always err on the side of six months just because I like to have extra protection. Why not have that extra protection for your financial life? The thing that is going to allow you to have financial freedom, why not have more protection there? Sure, it's going to lose value to inflation every single year. It would be better off invested. Absolutely if you want to talk about optimization.

Starting point is 00:12:25 But if you're talking about things happening in life, life happens and you need to prepare care for it, and that's what this emergency fund is there for. So these are the three basics, is having these in place. You want to protect your day job and actively be working to protect that day job. You want to have that cash buffer in place and be able to cover any deductible that comes into play. And then you want to have that emergency fund in place as well. Now, the cash buffer and emergency fund are part of our stairway to wealth program.

Starting point is 00:12:52 If you haven't heard that episode, the stairway to wealth, we talk about the order that you should be allocating your dollars, and that is part of that system as well. So this is the three basics that everybody should have and absolutely needs to have. Now, we're going to talk about some advanced strategies to really fortify your financial strength. So lately, I've been noticing how fast things are changing at home. The kids are growing like crazy. Clothes don't fit anymore and routines are changing. And it just hits you.

Starting point is 00:13:20 Life is expanding. And when your life grows, your responsibility grows with it. That's something I've been thinking about more this spring, making sure the safety net we have in place actually matches the life that we're building. And that's where PolicyGenius comes in. PolicyGenius is an insurance company. They're an online marketplace that helps you compare life insurance quotes from some of the top insurers in America, all in one place for free.

Starting point is 00:13:43 And their licensed team works for you, not the insurance companies. So they help you find the right coverage for your situation without all the guesswork. And they walk you through everything. Answer your questions, handle the paperwork, and help you get the coverage that actually fits your life today and where it's going. So protect your family with a policy that grows with your life. With PolicyGenius, you can see if you can find 20-year life insurance policies, starting at just $276 a year for $1 million of coverage. Head to PolicyGenius.com to compare life insurance quotes from top companies and see how much you can save. That's PolicyGenius.com.

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Starting point is 00:16:00 acceleration that makes city streets feel like open roads, plus a refined interior with innovative technology always at your fingertips. The all-electric ID4, you deserve more fun. Visit vw.ca to learn more. SUVW, German engineered for all. Now before we dive into these advanced strategies, one other thing I wanted to mention is with your emergency fund, over time, you want to be growing that emergency. Fund. Here's the reason why is because it's one of those things that as you approach retirement age, it doesn't matter if you're going to retire early in your 30s or 40s or if you are going to retire at traditional retirement age, you want to have more cash on hand. Having more cash on

Starting point is 00:16:40 hand in retirement allows you flexibility. In addition, having more cash on hand in retirement allows you to be able to draw on that cash when the market has big correction. Say, for example, you retired three years before the Great Recession of 2018. 2007, 2009, that whole range. Well, stocks were way down during those years. And if you were drawing down on retirement, you'd be drawing down on some of the lowest of lows that we've ever had. That would drastically change the way your retirement went and how much money you could

Starting point is 00:17:08 draw down. But if you had extra cash on hand that you could draw down when markets go down 50% like that, just in case markets go down 50% for a short period of time. As we know, over the long period of time, markets go up over a long period of time. But during that short period of time, if you had some extra cash, that you could utilize or at least supplement your income and then when you draw down some of that money as well, then it's going to take less of an impact on your retirement if at all. I mean, if you have three years of cash on hand, for example, when you retire, which is an amazing thing

Starting point is 00:17:38 to have, then you'd be able to draw down on that cash, live on that cash for those couple of years when that event occurs. So that is one thing to consider as well. So the way I developed it was three months, six months, one year, and then however much you want and retirement, two years plus. If you want to retire in 30 years, for example, slowly over time, you can build up that emergency fund. This is not to say you shouldn't use your emergency fund, because a lot of people like to hype up that they don't use their emergency fund. You should definitely use it. That's what it's there for. But building it up over time is going to allow you to have that extra cash on hand. And it's amazing how much it will actually build up if you just

Starting point is 00:18:13 continually funding it, you know, a couple hundred bucks every single month. So this is a great starting point and then start to think about how much cash do I want on hand in retirement. Sure, having that much cash. I am the guy who, when you're in your wealth building years, I want you putting as much dollars as possible into assets and not saving it in cash. But as you approach retirement and get closer to that retirement age, you should definitely look and consider having cash on him. Now, the next thing we're going to do is the advanced strategy. So the first one is having access to credit. Having access to credit, what does that mean? So I'm talking about two different things here. The first one is a helock, H-E-L-O-C. What does that stand for? Home equity, line of credit. If you want a house and you have equity in your home, and a lot of people right now do because the market's been very high, if you have equity in your home, at least have access to a home equity line of credit. Open one up. Let me give a simple example here. Let's say you bought a house for $500,000. And then three years later, now it's worth $800,000. With a home equity line of credit, you can draw out, you know, $2.250, you can get something set up where you can draw down

Starting point is 00:19:20 $200,000, $250,000 of the equity that you have in that house. And the cool thing about this is that means you have cash available if something happens. So this could be your third line of defense where you have a large sum of cash available to you if something happens. Now, in a couple of weeks, we have someone coming on who's going to be talking about a very cool strategy of utilizing HELOC. So make sure you're subscribed to this podcast because I am really excited for that interview to share it with you guys. And it's going to be something that is going to be really beneficial, I think, for a lot of people. But when we have these key locks in place, this is also another form of an emergency fund that we can have in place as well. Now, this should not be your primary emergency fund. It absolutely should not be.

Starting point is 00:20:01 But if you're building up your emergency fund, it's great to have this in place. If you already have your emergency fund in place and you are thinking about the same thing I am when the market dips in your closer to retirement, it's great to have this in place. Having access to funds is always a good option. And having flexibility in finance is always a good option. So you can go look at your local bank. I have one at a local credit union. I don't bank at that credit union, but they had the best rates. So I have one at the local credit union close by to me.

Starting point is 00:20:29 And you can look around, shop around, find the best rates, get low rates if you can, and open up that hellock. You don't have to utilize it, but it's available to you and it's there. Now, some banks want you to use it. So you want to ask them, how often do I have to use this to be able to have this helock available to me? But having that equity line of credit is something you definitely want to consider. Also, if you have a business, you can get a line of credit on your business depending on how long you've been in business for. And that line of credit can be on your assets. It can be on revenue sometimes.

Starting point is 00:20:58 It depends on what you're looking at. But if you have a business in place, you can also draw down on some of the equity in your business and have equity available to you when you need it. And having both is fantastic. The more equity sources that you have access to tap into in case that you need them, the better. Now, the only reason to use these is, A, if you want to use a he lock, is to buy assets. And the second reason would be an emergency situation. Those are the two reasons to have these available to you. So having them available is a fantastic resource as well.

Starting point is 00:21:28 I know people who invested real estate with the helock. They do a lot of different things. We'll have episodes talking about that as well because I think the helock is a lot more powerful than people realize. It doesn't compound the same way a mortgage does. So we'll talk about that as well as we go through this process. The next one, the next fortified line of defense. It's amazing how much capital is actually available to you when you learn about all these things. The next advanced strategy is having access to a securities-based credit.

Starting point is 00:21:53 What does this mean? This means you can borrow against your assets. So one of the things we just talked about was the HELOC is you can have a HELOC on your rental properties too, which is another amazing thing where you can consider borrowing against an asset. Your rental properties are an asset. And if you have equity in those rental properties, you can get a HELOC and buy the next property if you want to. The same thing goes for your stocks.

Starting point is 00:22:13 Now, stocks you can't borrow as much as a traditional heloc. He locks, you can usually get 80% loan to value. When it comes to stocks, it's a little bit different. So it's going to be a lower amount that you can borrow against stocks. But having that available to you is also very interesting. So, for example, one brokerage that does this that I love is M1 Finance. Because M1 Finance has lower rates than, say, a fidelity does or other brokerages that are traditional brokerages.

Starting point is 00:22:39 And M1 Finance has accounts that it's very easy to do this. Say, for example, you have $100,000 and a $1. an NM1 finance account, you could borrow $40,000 against that $100,000 and just pay interest on it. So it's just a loan against your equity that you have in there. So this is something where if you're a long-term investor, you're not going to touch that money ever and you want to liquidate some of that money for something else, you'd be able to do that. Now, the interest rates on these are much higher than a HELOC would be. So banks are always much more willing to lend out on property, on physical property, than they

Starting point is 00:23:09 are on securities. But this is a great option to have as an additional emergency fund or so you don't have to liquidate your account and pay taxes. That's the other side of this. If you have a really big account, you have a bunch of capital gains and you want to buy something else. Maybe you wanted to liquidate your stock so you could buy a apartment building, for example. Well, if you wanted to do that because we're trying to upgrade your cash flow and your strategy, you wanted to diversify your asset allocation, meaning maybe you wanted 50% real estate now and 50% stocks instead of all stocks. well instead you could borrow against that account and pay an interest rate usually the interest rates like i said are higher but that's why i like em1 finance because their interest rates are a little lower from what i've seen as of late so check that out as well m1 finance is linked down in the show notes that is an affiliate link so if you utilize that link we do get a kickback at no extra cost to you so we appreciate that if you do that but that is another option if you want to do that the next one we're going to have an entire episode on as well and you've heard a lot of sponsors on this podcast for very good reason is having term life insurance. Now, listen to the very specific words I'm saying here. Term life insurance. I'm not saying universal life insurance. I'm not saying indexed universal life insurance, IULs. I'm not saying an MPI account

Starting point is 00:24:21 or any of those types of things. I'm saying term life insurance. What term life insurance is, is if you have dependence in your life, whether it be a spouse that depends on your income, whether it's children that depend on your income, maybe it's aging parents that depend on your income. Maybe it is a business partner that depends on your income. If anybody in your life depends on your income, you need to have term life insurance. And it is very inexpensive to have. Now, here's the strategy here. When you have term life insurance, you can get a half a million dollars for 30 bucks a month. And the cool thing about that is, is that it's very easy to sign up for. There's not a lot of extra things. But in general, there's not fees. It's just that 30 bucks a month you are paying the

Starting point is 00:25:01 life insurance company for a specific term. So for example, I just got one. And my specific term is for 30 years. The reason why I did it that way is because in 30 years, I'm going to be in my very early 60s. And so what that's going to do is allow me to, hey, I'm going to have a big enough nest egg where I'm not going to need life insurance anymore. I'm going to have my wealth already built out exactly where I want it. So I'm not going to need this life insurance anymore. So that policy terms, what that means is it ends at that point. And so all the money you paid out over the years are the money that the insurance company makes. But if something happens to you, then they have to pay out that life insurance to your families, to your benefits, to

Starting point is 00:25:35 of your beneficiaries so that your income is covered and this protects your income if anything happens to you. This is something that you definitely want to have you. Don't want to skip out on this because it is so incredibly cheap. Half million dollars, like I said, it's 30 bucks. So doing this protects your family, especially if you have kids. If your kids depend on your income, you absolutely should have this and it should be willed down to them and you should be able to have this in place for them so that they don't have to struggle in life if something happens to you. So this is something where it is incredibly valuable to have. It is incredibly cheap.

Starting point is 00:26:07 You can do it. You know, we have great sponsors on this show that are linked down below that you can check out that will be able to help you go through this process. And when I got my term life insurance, it took me about an hour. And boom, I had the policy that day. So it's a very simple process. You don't have to go get health scans on a lot of these things as well. So this is the incredible power of this.

Starting point is 00:26:25 Now, the other types of life insurance, why not other types of life insurance? Because other types of life insurance charge you with incredible fees, and you have to pay them for the majority of your life. Now, you can have terms on them and things like that, but for the most part, they are charging you crazy amount of fees. And if anybody tries to tell you that life insurance is an investment, let me say this very clearly. There is a very select few people who actually understand how to do life insurance and investment. I would say it's 0.0001%.

Starting point is 00:26:53 99.999% of people who are telling you life insurance is an investment is making more money than you you are on that policy. And they want to earn money and they want to earn your business. and they're going to tell you things, talking to you, TikTok people. There's a lot of people on TikTok to talk about life insurance, and most of them are going to make hefty, hefty fees and hefty commissions.

Starting point is 00:27:15 Understand this now. Your boy has got your back, and what I'm trying to do is tell you, these people are telling you things that they're going to make a ton of money. I'm telling you this to help back you up and to help you out. I make zero dollars from telling you this. They tell you that they're going to help you invest your money.

Starting point is 00:27:32 It's going to be better than a Roth IRA. it's going to be better than an index fund, do not listen to those people. I'm warning you now. They are snake oil salesmen. A lot of them are selling you snake oil. So understand this now. You've got to really vet who you're listening to. We will have an episode on this, I promise, because it is something that I'm passionate about.

Starting point is 00:27:51 A lot of people are getting scammed out of their retirement from people who are trying to push life insurance. So term life insurance is the best. It's the cheapest. It's going to allow you the protection you need and it's all that you need. Then you can take the difference because if you go to, something like universal life insurance, for example, the same policy that's $30 is going to cost you $3, $500, depending on how you set that up. You can invest those dollars instead. And then when you invest those dollars into a specific account into whatever you want, index funds or whatever else you

Starting point is 00:28:18 want, as that account grows over the course of 30 years and once your term policy is done, you're going to see that amount of money, $300, $500 over the course of 30 years is a million if you invest it in something like an S&P 500 index fund. Historical returns. And we're talking about what would happen historically. So that is the cool thing about this is allowing your money to compound over time instead of relying on somebody else. So that is term life insurance. The next one, identity protection. Now, identity protection is something that you definitely want to have.

Starting point is 00:28:48 And the reason why you want to have it is because your identity is going to impact a lot of things. So the first thing that you can do is you can get something like LifeLock. And LifeLock is going to help alert you and tell you when things happen to you. Because if somebody steals your identity and I have had my identity stolen before, if somebody steals your identity, they can destroy your credit score. Now, we've talked about the credit score here a couple times in this podcast before. We have full episodes on it. And you know, I've done the math on those. If your credit score is stolen, your credit score is destroyed, what happens? That means you're getting way worse interest rates on a lot of different things. Those interest rates can cost you hundreds of thousands, if not millions of dollars over the course of your fight. financial life. So you want to make sure you protect that identity because it is a mess to get it fixed. So a couple of things that you can do. You want to have identity theft protection. I use life lock. I'll link them up down below. That's also an affiliate link, but they're just a great, easy way to do it. But you want to make sure that the company has real-time activity alerts and frequent

Starting point is 00:29:51 credit score updates from major credit bureaus. That's Equifax. That's Experient and that's TransUnion. If somebody opens something in your name, you want to make sure that they alert you. All of a sudden, there's a student loan open to your name, which happened to me, or if there's a credit card open to your name, any of those things, you want to make sure that they are alerting you. These features, if they can alert you, can stop unauthorized loans. So that is what I love about using this as well. And we are working on an episode, since your digital information is so important,

Starting point is 00:30:19 I am working on an episode talking about how to protect your financial life, especially in the digital age online and all that stuff as well. So this is one that we will definitely be covering as time goes on here. Now, let's jump in to the next steps. All right, so the next steps are you want to have ample insurance in play. So the first one is health insurance because you want to make sure that you have the right health insurance for your situation. Now, we know I love high deductible health plans if you're healthy. The reason why is because you can invest in an HSA.

Starting point is 00:30:51 And an HSA is such a powerful retirement account and allows you to do so many different things that you definitely want to have that in play if you are healthy. But you also want to consider your deductible and how much you're going to have to pay out of pocket if something does happen to you. Say, for example, you have a high deductible health plan. You truly can't afford a $5,000 payment. Well, maybe a high deductible health plan is not the best option for you. Instead, you should opt for something where your premiums are a little bit higher, but your deductible is not going to destroy your financial life.

Starting point is 00:31:19 So you got to think through some of that stuff as well and think through how you are going to be able to work through this. In addition, you can consider disability insurance. If you are at high risk of disability, this is not something. I have, but if you're at high risk of disability, what it does is disability insurance covers you if you can't work or become disabled. So there's a bunch of pros and cons of disability insurance, but if you want to protect yourself, if something happens to you where you can't work anymore and you think you're at high risk of that, like if you're working a physical job, like you're in construction

Starting point is 00:31:49 or something like that, that may be more of a situation where you need disability insurance because you're at a much higher risk of getting hurt. If OSHA is on your job site all the time, then you maybe want to have disabilities. insurance in play because you do not want to get hurt. For example, my father-in-law has a company where he works on bridges. That's a great situation. If you're up high on a bridge, you are hanging off of bridges on the side of bridges and things like that, you want to make sure that you have disability insurance in play.

Starting point is 00:32:16 And then as you age, another thing to consider is long-term care insurance. Now, I don't love talking about long-term care insurance. It's not something I have. The reason why is because it's very complicated, A, and B, it's very expensive. And what it is is it's insurance to cover you if you ever need to go into a nursing home and you don't want to put the liability and the burden on your family members. And long-term care insurance, like I said, is very expensive, but it does have a lot of benefits. And it covers if you have to go to a nursing home or assistive living or in-home care or if you need medical equipment and all that kind of stuff as well. It just adds extra protection.

Starting point is 00:32:52 So if you're becoming wealthy, you're building a lot of wealth and you want to make sure that you're covered in that. arena, I would definitely look at long-term care because this is something where it doesn't hurt to have, especially if you have the extra cash available to add to your protection plan, you want to make sure that you have that in play so that you are covered. And then one other thing I want to mention as we talk about some of the fraud alerts, I'll mention on the end here, is that all of the credit bureaus, you can actually sign up for alerts from them directly as well. So you can go to Experian, you can go to Equifax, and you can go to TransUnion.

Starting point is 00:33:24 And what you want to do is you want to make sure that they send you alert, if anything is open in your name. That's going to allow you to get emails. You get a quick email. Tells you, hey, this credit card was just opening your name. Did you do it? And then you could say yes or no. Another way to do this is you can also use your bank.

Starting point is 00:33:39 So like Chase has this. Capital One has this. A lot of the major banks now have ways to track your credit score and they'll tell you when new things come up on your credit score. So making sure that you have those alerts on as well, just having a fortified way to be able to see all those alerts come up is incredibly powerful for your long-term financial health. So these are all things that we are going to talk about here on your protection plan.

Starting point is 00:34:01 Obviously, another one is tracking your spending and your budgeting and making sure you know where every dollar goes because this allows you to put your dollars where you want them to go. And this is another form of protection. Understanding where your money is going because you don't want to get to the end of the month and say, where did all my money go? You're protecting yourself by tracking your spending and having a spending plan in place and consciously putting your dollars in specific places that you want them. So this is how you can put together a fortified bulletproof wealth protection plan. If you have all of these layers in place, it is going to be very difficult to have a lot of financial strain because you're going to have so much flexibility and so many options and so many things in place that no matter what happens to you, you're protecting yourself,

Starting point is 00:34:42 you're protecting your family, and your generational wealth that you're working so hard to build. Listen, I hope you guys learned a ton in this episode. If you guys have any questions, make sure you are all. on the Master Money newsletter, linked up in the show notes below, and respond to any of those emails that we send out every single week so that we can answer your questions via email. And also, don't forget to leave a five-star rating and review on Apple Podcasts and Spotify.

Starting point is 00:35:06 And share this episode with a friend. If you think people would benefit from building up this financial fortress, this bulletproof wealth plan, please share this with a friend. We truly appreciate each and every single one of you. And I'll see you on the next episode. Frozen lasagna, medium power, 15 minutes. Sounds like Ojo time. Let's play.

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The Personal Finance Podcast - How to Create a Bulletproof Wealth Protection Plan

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