Saturday, March 14, 2009

Profiting from our mistakes...or at least salvaging something

Doing something dumb with your money need not be financially fatal.

Case in point. I was doing some research recently for a Kansas City Star story about budgeting for a job loss and came across a video clip from a Texas television station in which financial planner Jim Lacamp talked about looking for quick cash in unlikely places.

Two of them especially grabbed me. Lacamp mentioned borrowing from cash value life insurance policies and also cashing in some of that credit insurance you might have bought when you applied for some of your plastic. Many planners think both those insurance products are poor choices for many of us.

None of us makes perfect decisions. I bought some whole life when I converted my GI life insurance 40 years ago, have added more of it since then, and generally kept my mouth shut when planners I respect extol the virtues of the term insurance I didn't buy.

And it's paid off, in at least a small way. We haven't had to tap our whole life policies to buy groceries yet and don't expect to. But we have begun using the continuing dividends to pay premiums and keep the coverage going. And, if the economy remains really bad for really long, our insurance savings are another source of help against cashing in retirement savings. I wish I could claim to have been really wise back in the day, but the truth is I didn't know better back then.

So, hang loose. You often can find something to salvage from almost anything. And if your job looks shaky right now, don't panic. There are both some practical things you can do and some broader things you should remember to get through the rough spots. Good luck.

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