Managing financial risks involves a four-pronged approach that includes:
• Identifying your potential risks
• Analysing and quantifying the severity
• Devising a strategy for managing these financial risks
• Consistently monitoring strategies to determine the performance
Factors that contribute to financial risks are often:
• The risk of an early demise or living a longer-than-average lifespan
• The risk of exorbitant medical expenses towards your treatment or a family member’s
• The risk of losing your job and consequently, your regular monthly income
Team Avenir recommends the listed avenues to manage and mitigate your financial burden should you encounter unforeseen risks:
Contingency Planning
Building up a contingency fund will safeguard you from unforeseen risks like a natural disaster, pandemic, or a sudden drop in your earnings. With contingency planning, you can manage these risks without feeling the financial pinch. A contingency fund with a value equalling three to six months of income helps you tide over such emergencies. Team Avenir capably assists you in this respect.
