Throughout Financial Planning Week in Bermuda, October 6-12, 2008, we have been following the Couple family, a composite family created by Argus Financial Limited, as they take charge of their financial wellness. Here is the fourth part of their story.

The Couples are thrilled; they have finally paid off their last credit card. They have also decided to purchase a significant new piece of equipment for the family business. The small life insurance policy Dad left them could pay for the equipment, but they have been using that money as a cash reserve for unexpected emergencies in the business. Although they don't like the idea of debt, especially after working so hard to get rid of their credit card debt, it does not make sense to deplete all their cash reserves when they can price the additional cost of interest on a loan into their quotes.

The Couples approach the bank with their business plan; their strategy is to use the cash from the life insurance policy as collateral to secure the loan and reduce their interest rate. The bank was very impressed with their thorough analysis; approval is almost immediate. The Couples practically danced out of the bank.

Life is looking good. They expect that their cash flow will increase rapidly. They would like to take a celebratory vacation, especially after all their hard work, but they decide to stick to their savings plan and take an "on island" vacation on a friend's borrowed sailboat. It turns out to be one of the best family times they have ever had.

Recently, Mrs. Couple worked on a risk assessment at her job and decides her family needs to take the same action. The Couples identify three key risks that could jeopardise everything that they have worked so hard to achieve.

1.Mrs. Couple has employer-provided life insurance; Mr. Couple has no life or disability coverage. Statistically, he has a one-in-four chance of injury on the job or a stress-induced illness caused by his increased financial and family (mom too) responsibilities.

2.The Couples do not have wills. They are unaware that should tragedy occur, their wishes and care for their beneficiaries may not be followed.

3. His mother's home is not protected from Bermuda estate stamp duties, a significant concern. Mrs. Couple contacts local insurance companies and arranges to buy group life and disability coverage, along with additional voluntary life insurance for her husband. She will revisit their life insurance options every few years with their agent, keeping in mind that their needs (and coverage) may change significantly.

The Couple's discover that if they die without a will (intestate) the courts will take control of their estate. They make an appointment with their lawyer to draft their wills. They want to ensure their children are well taken care of should the worst happen.

Mrs. Couple motivates her mom to find a nice part-time job. Mom loves it and now has reason to get up and out of the house regularly. The extra money should also help eliminate her frequent requests for cash.

Mr. Couple's best friend just paid significant death taxes on his dad's family home. The Couples know, at the event of his mother's passing, they would have to sell their family home in order to settle the estate. The "Designation of Primary Family Homestead" application will protect the family home from death stamp duty and is available from the Office of the Tax Commissioner.

The Couples are achieving financial wellness. They are increasing their earnings, have eliminated bad debt and have taken active steps to reduce unexpected financial risks. Next, the Couples will complete their financial wellness makeover by learning how to properly invest for their future.