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M It's wise to plan for the unexpected from Mother Nature Dollars & Sense Peter Watson Guest Contributor 19 | Thursday, July 18, 2013 | OAKVILLE BEAVER | www.insideHALTON.com other Nature has taught us a hard and cruel lesson on the nancial risks we all face. Humans are at the top of the food chain but Mother Nature trumps all. Last week, parts of Toronto were ooded. Monday during the evening rush hour the city received the equivalent of one month's rain in two hours. Flash ooding shut down major highways. We heard about that on the news and rsthand from anyone from Oakville who was caught in the torrential downpour. Some public transit riders swam to safety and in some cases were clinging to trees. From a nancial perspective, the real story is about the ood's damage to many houses. Depending on your home insurance, different risks such as ooding may not be covered. That is the real lesson of this ood. Many households have over-extended themselves nancially to the point where they live month to month. One of the realities of advanced consumerism is that we maximize our spending. Costly repairs are the nancial risk of this storm for the families with extensive damage. This is compounded by those that should be done immediately before water damage, mold or health issues arise from sewer backups. We do not anticipate these nancial risks; however, some households will be in a precarious nancial position of having to pay for unexpected repairs. These are serious issues and they do happen. This spring, a large part of cottage country was subject to major ooding. More recently, Calgary was devastated by their worst ood ever. What we can conclude from these recent oods is that "things happen". This is a part of life. These are the news events of this year and the only certainty is there will be future news events with similar nancial implications. Risk is a real nancial threat, which can come from natural causes, accidents and health issues. Risk management is an important part of nancial planning and our recommendation is to manage it carefully. First, try to protect yourself. Review your insurance and make an educated decision on how much coverage is right for you. Insurance has both a cost and a bene t. Determine how much you can afford and how much risk you can afford to have without adequate insurance. Second, be creative about nding a solution when you have been subjected to a nancial loss. This can apply to how you spend the money on repairs and adjust your nances to help manage your unexpected costs. Increasing or creating household debt is one option, but that loan will have to be repaid at some point. Most anticipate interest rates will rise so that debt might become more expensive as time goes on. The recent ooding in Toronto and elsewhere should motivate you to review your insurance coverage on all risks you may encounter. Our suggestion is to have that insurance review with your insurance provider. The ultimate goal would be to balance prudent insurance coverage with a proactive approach to managing nancial losses in the event of an unexpected occurrence. -- Submitted by Peter Watson, MBA, CFP , R.F .P ., CIM, FCSI., Certi ed Financial Planner Don't miss these, and other great deals! Visit Proudly Canadian Follow us: @wagjag facebook.com/wagjag Buy Online: 58% off $19.00 $19 FOR A LOCAL COUPON BOOK IN SUPPORT OF SPITFIRE CHALLENGE $45 VALUE Buy Online: 71% off $25.00 Buy Online: 55% off $79.00 UP TO 88% OFF FITNESS CLASSES AT SPINAFLEX INC. 3 OPTIONS $79 FOR A 1WEEK FULLDAY CAMP FROM AUGUST 1216 AT CAMP OMAGH $175 VALUE 1 Brought to you by How to buy a WagJag: Go to www.wagjag.com 2 Click buy on the offer and follow the instructions. 3 Receive your deal, tell your friends and enjoy! You're looking HOT! Stay cool and comfortable all summer long with an AIR CONDITIONER from Sandpiper and make no payments until September 2013! Get Cool for FREE! Absolutely NO up-front costs! FREE installation and repairs AFFORDABLE low monthly rates LOCAL Priority Service 24/7 ENERGY EFFICIENT brands and models Call Sandpiper Today for your FREE in-home assessment 888-668-8117 sandpiperhomecomfort.ca A DIVISION OF OAKVILLE HYDRO ENERGY SERVICES INC.