Insurance You Actually Need
This section covers the insurance that protects your path to financial independence: which policies guard against losses big enough to derail a decade of progress, and which ones you can self-insure from your emergency fund. The guiding line is that insurance is for ruin, not inconvenience.
It assumes you already have an emergency fund in place, since that fund is what absorbs the losses you don’t insure. If you’re still building it, start with Emergency Funds first, then come back here.
What you actually need
Section titled “What you actually need”Six pages, one per policy. Each explains what the coverage protects against and how to size it for where you are on the path.
- Health Insurance: Why medical debt is the catastrophic risk to insure against first, and how to read a plan.
- Auto Liability: How liability coverage protects your assets from a lawsuit, and why state minimums fall short.
- Renters and Homeowners: What property coverage replaces and how to set your dwelling and contents limits.
- Term Life Insurance: When a death benefit is necessary, how to size it, and why term beats the alternatives.
- Long-Term Disability: How to insure your ability to earn income, the asset most people forget to protect.
- Umbrella Liability: What an umbrella policy adds once you have real assets, and when it’s worth buying.
What’s not here
Section titled “What’s not here”Whole life, extended warranties, credit card protection plans, identity theft insurance, accidental death policies, and specific-disease coverage like cancer insurance get marketed hard, but they sit below the catastrophe line your emergency fund already covers. This section doesn’t give them their own pages. The term life and health insurance pages explain what to buy instead when an agent reaches for one of them.
Where it gets hard
Section titled “Where it gets hard”Health coverage for the self-employed and early retirees is a genuine problem with no clean answer, and the cost belongs in the spending number that drives your 25x calculation. The Health Insurance page works through the ACA marketplace, the Medicaid gap, and how to fold the premium into your FI number.
What’s next
Section titled “What’s next”With debt cleared, an emergency fund in place, and the policies above protecting against catastrophic risk, the money management foundation is complete. The question shifts from protecting what you have to how much is enough.