Shashin Shah, a finance professional based in Dallas, knows that the best thing a planner can do for a client is to foresee worst case scenarios and help clients put all the pieces in place in case those scenarios happen.
There are planners who help individuals put key documents together-wills, medical directives, insurance, and asset information and hold a copy in their office in case of emergency, Shah explains. “And there are other planners who make preparations and are brought in to stage-manage a crisis. A planner acts on the wishes of the client, but his or her job is to determine exactly what the client needs.”
Such events don’t have to be as dire as the sudden or expected death of a loved one. “Part of disaster planning is having not only paperwork in place, but funds to insure an individual if he or she loses a job or disability insurance after an injury,” Shah explains. “The emergency fund is the true financial independence plan, and it’s critical during times of crisis.” Parents should also have a plan in place for events that bring unexpected costs, such as adult children moving back home. “Parents need to talk about whether they’ll charge rent or require in-kind compensation of household expenses, because it’s a significant financial strain.”
A talented planner gets clients to talk about their worst fears and steps back from those concerns to draft a plan that includes as many contingencies as possible. The plan is as unique as the person. Shah believes that once a crisis plan is developed, it should be revisited every two to three years. “Lives change. People get divorced, they have babies, and they move and change jobs. Every aspect of a crisis plan-wills, insurance, emergency fund, and other issues-should be reviewed at that time.”