I have a self-employed pal who had to take time off of work recently for medical reasons – for three months. Wow! I don't know many freelance or self-employed entrepreneurs who could take a hit like that and have it not really, and negatively, effect their business.
And that got me to thinking. “Steve,” I said to myself, “you need a backup plan.”
So what does that plan entail? A few things:
1. There needs to be a document that explains what needs to get done, and when. What are the critical things that you do every week that someone would need to do in your stead if you become incapacitated?
2. All important papers, codes, log-ins, and documents need to be in order and in one place. What are your pass codes? What about bank info? Security passwords?
3. Training. The key docs and information need to be in the hands of a trusted associate who has been trained to know what it is you do that they would need to handle.
4. Get disability insurance. In case you (or I), like my pal, end up needing to miss a significant amount of time at work, what will you do, financially? Disability insurance can help cover your costs in that case. It is an affordable solution.
5. Make sure your other insurance and finances are in order. Of course you need the right health care coverage. Do you have your living trust in order? Do you have co-signers who can access your investment accounts?
Bottom line: Make sure your house is in order.
Am I missing anything? What do you think?