“New York City was not prepared for the destruction that occurred September 11th, 2001.” Mayor Giuliani surprised our audience at the World Business Forum with those seemingly harsh words. The recovery in New York was nothing short of spectacularly inspiring. The city moved as a single unit to cope with the crisis almost as if totally prepared. So what was Giuliani’s point?

“Our leaders had prepared for many other threats – the bombing of Grand Central, attacks on the harbor, etc. – that we were able to use all the micro plans that had been created to form a massive response to the destruction of the Trade Centers.” It was planning ahead that helped  New York, not the plan itself.

There are probable occurrences, and there are possible occurrences. Circumstances that will or could create challenges for you financially and emotionally. The point of good planning is trying to identify those situations that could cause interruptions to our lives and deal with them ahead of time.

General Patton shared his feelings about planning in advance by quipping that “no battle plan had ever made it to the battlefield but that no battle had ever been won without a plan.”  In other words, understand it won’t be a perfect plan but have a plan nonetheless.

When we examine financial circumstances for a new family, we attempt to help them identify the most expensive risks they are exposed to with the least probability of occurrence. Those are the risks most easily addressed by insurance companies.

There are events that have a high cost associated with them and more difficult to transfer to an insurance company. A common challenge is caring for aged parents, which can be both financially and emotionally draining. That is where planning has to come into play.

Examine your life for the biggest risks you couple possibly endure. My guess is you didn’t see the Pandemic coming, but you may have planned for a possible lay-off at some point. The strategy for losing your job would have helped you deal with this crisis.

Just because you have a plan or tried to plan won’t necessarily solve the problem.  You simply cannot mitigate every risk. That doesn’t mean ignore them.  Disability, job loss, loss of a spouse, parent or child issues, and your list may have more.

This is not a pessimistic overview of the world. Please don’t look at planning for challenges as being negative. Looking at the eyes of a young child and the thought of a plan for college expenses or weddings can be daunting but not negative. Your job is to examine your life for risks that may present themselves and determine your strategy before the occurrence.

As the General pointed out, the plan you have in place probably won’t be the perfect plan, but your response will likely be better because of the planning you’ve already done. I call these “fire drills” as we did in elementary school. The building never caught on fire, but we all knew our place just in case.

Disclaimer: Joseph Clark is a Certified Financial Planner™ and the Managing Partner of Financial Enhancement Group, LLC an SEC Registered Investment Advisor. He is the host of “Consider This” found on WIBC Saturday mornings from 6-7a.m. as well as three other Indiana-based radio stations. Joe has served as an Adjunct Assistant Professor at Purdue University where he taught the capstone course for a degree in Financial Counseling and Planning. Financial Enhancement Group is an SEC Registered Investment Advisor.  Securities offered through World Equity Group, Inc., Member FINRA/SIPC, and a Registered Investment Advisor.  Investment Advisory services offered through Financial Enhancement Group (FEG) or World Equity Group.  FEG is not owned or controlled by World Equity Group. Joseph Clark and World Equity Group, Inc. do not provide tax or legal advice. For tax advice consult with a qualified tax professional. For legal advice consult with an attorney.