This is the fifth exercise in a series designed to walk you through an entire financial plan. The exercise is embedded in an Excel spreadsheet you can download and save for personal use. You can find the backdrop for the exercise HERE or just jump right in with the instructions given below:
The best way to see activities through a risk management lens is to go through some ideas of your own, like the example of my car accident, and discuss or jot down the ways in which that risk could have been managed with each of the four methods. It doesn’t have to be something as dramatic or painful. It could easily be a risk management success story that you can now better understand.
Examine both the personal and the financial risk using all four of the risk management techniques. After doing that exercise, discipline yourself to analyze a few other examples throughout the course of your days. If you’re bold enough, teach the technique to a friend or family member (there’s no better way to learn something than to teach it). Eventually, it won’t be work, and you’ll see your options more clearly. Then, when you examine your existing insurance products or new offerings, look for ways you can reasonably avoid, reduce, or assume the risk before paying someone else to do it for you.
Click HERE to access the app!