WHAT IS RISK MANAGEMENT?

Risk management is the process of identifying, assessing and controlling ANY THREATS – this may include: Individual, companies or even investments.

Today we will be talking about individual risk and why it is so important to look into these matter seriously; example – Critical Illnesses, Disability, Hospitalisation, Loss of Income and in the worst case – DEATH.

We can’t control natural disaster or accidents – it will happen when it wants to happen even with all the safety measure put in place, therefore is a necessity that we take measures to control the risk.

LIFE INSURANCE AND IT’S PURPOSE

Risk management is a broad topic. It involves taking steps to minimize the likelihood of things going wrong, a concept known as loss control. It also involves the purchasing of insurance to reduce the financial impact of adverse events on a individuals or company when, despite your best efforts, bad things happen; Insurance companies absorbs such risk by sharing risk.

Types of Risk We Carry Everyday

  1. Timeline Risk
  2. Market Risk
  3. Loss of Income

What is Timeline Risk?

Timeline risk is – death, disability and dreaded diseases that may occur to us anytime. Therefore individual buys Insurance to cover the risk that may occur on the timeline with the Insurance companies.

What is Market Risk?

Market Risk is our investments – our investments may go wrong due to unforeseen incidence like Stock Market Crash, Business failures and etc. Therefore individual will protect their investments by diversifying their investment so that it stays buoyant even the market goes wrong. “We at FINWAZE construct investment portfolios that can withstand market shock and yet have a decent rate of return each year 12-18% consistently”

What is Loss of Income?

Loss of income can happen to anyone anytime; company can go bust and retrenchment can swallow our jobs. What are we going to do when we have loss of income. Therefore is important that we have 12 months of living expenses savings in the bank bank (liquid); so that it can take care of us in the event things goes wrong.

STARTING YOUR JOURNEY PUTTING THINGS TO ORDER

Remember each one of us are accountable for our own actions – you can choose to ignore the risk or do something and ensure the risk is taken care. Speak to a eagle financial advisers that reads widely and gives good advice on what are your options. Take time to share all your concerns and protect all the 3 risks – Timeline Shock, Market Shock and Loss of Income.

Article by: Strategic Coach & Mentor.

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