How to protect your family from financial ruin in the event of your passing

You can never predict when you will die.  The even sadder truth is that most of the time, your family is unprepared for it and this adds on the grief and pain.  It is even grimmer if you are the sole or main breadwinners – your passing may leave them in a deep financial lurch that may take a long while to recover from. 

Putting into place some steps can help reduce the effect of your passing.  Some important things to do now so they will be alright when you die are:
-    Getting the right type of life insurance.  Not just getting insurance, but the right kind.  It could be a term or whole life insurance; as long as it benefits you and the ones you love the most, it is a good policy to have.  This is why heavy deliberation at the point of purchase is super important.  If you have bought a plan that does not help in any way, it is nothing but a waste of your money and precious time.
-    Investing wisely.  Some people think buying into the stock market is a smart investment.  It can be, as long as the market conditions are constantly positive, which you know is not possible.  More often than not, you hear of people who have lost everything they had because they put all they had into stocks which crashed in some economic downturn. 

To invest wisely, never put all your money in one place, but SOME of it everywhere.  This means diversifying your investment portfolio – putting some in unit trusts, futures, bonds and if you can still afford to, stocks and currencies.  These last two should be the final few options as they are very high risk. 

On top of that, try not to invest with only one particular fund manager.  If that firm were to fall apart, so would your investment capital and whatever gains there are. 
-    Leaving a will.  Some may consider this superstitious and inviting bad luck but it is actually the opposite.  Making a will saves your loved ones the burden of uncertainty and worry about family assets and finances. 

A will also means less hassle in distributing whatever assets there are.  Your family members will also be able to move on with their lives much quicker with minimal dispute (if any) with the state.  Many people do not realize the amount of stress and cost that is needed to settle any asset distribution without a will.  In many countries, without a will, the state can take up to 30 percent of the assets’ worth even after distribution.  Leaving a will, therefore, will mean your loved ones get the true legacy we want to leave them with. 
-    Living prudently.  Having a prudent spending habit will go a long way in ensuring your family has enough to live on or, at least, carry on after you are gone.  Having the lifestyle of a spendthrift will leave nothing but debts and a truckload of trivial things for your loved ones to sift through and hopefully, sell off at a reasonable price. 

To be honest, how much love do you show you have for your family if you leave them with three Mercedes-Benzes that they have to carry on paying for?  If they are fortunate enough, they may be able to sell off one of those, release themselves from an unnecessary debt of luxury and settle with a modest sedan. 
-    Staying away from scams.  Whether it is a get-rich-quick, guaranteed-profit-scheme or no-interest-loan, there is always a catch somewhere and that catch is often a cage.  Avoiding all of these and other scams of equal nature will go a long way in ensuring your family is safe from loan sharks, unscrupulous so-called businessmen and unsavoury debt collectors. 

Any time you are tempted to try out one of these schemes, remind yourself that nothing in life comes free and if it does, you often pay a much, much higher price later. 

Living modestly, obtaining proper financial advice when appropriate and sticking to your principles are the best ways to guarantee your loved ones will not be further troubled when you are no longer around.  Just remember that living the good life usually has no shortcuts. 

And make sure you pass on this piece of advice to the ones you leave behind.