Can you give yourself a complete financial makeover in less than a week? I wanted to know. So here’s what happened when I read a book called “The Six-Day Financial Makeover” by Robert Pagliarini.
The beginning chapters went along smoothly. I admit, I cheated here. The book urges you to actually do the checklist. I did not. I told myself that first of all, it was a library book and no checking in the book allowed. And second of all, I felt that I’d already done the emotional evaluation. Critical stuff — but I wanted to learn and do something new. Turns out the stuff was still well-worth reading if not actually “doing”.
But next came where the book really triumphs. For me the “makeover” came charging in at Day 5, starting with the ominous word “SURVIVE…”
Oh yes. Survive. Sounds tough. And mentally I was prepped for it, since recently experiencing an irregular and unexpected trip to the doctor.
Pagliarini’s book does something here very well. It takes you down the path of how many of us think we’re “saving” money and how this can spell certain disaster with the smallest, unexpected turn-of-events. For me, these “real-world” stories were enough to scare me straight into the arms of several insurance brokers.
Starting on page 153 he explains what those numbers mean on your car insurance. For example, 30/50/20. Never pay attention to those before? Me neither.
The first number represents maximum bodily injury liability, stated in thousands. In this example, you’d have $30,000 coverage for bodily injury.
The second number represents maximum bodily injury liability, also stated in thousands, for everyone injured in one accident. In this example, $50,000. That covers everyone in your clown car.
The last number represents maximum property liability. In this example, you’d have $20,000 coverage for one accident. Okay, ready for a drive? Let’s get to the example in the book.
…On his way home from a long day at work, George runs a red light and hits an SUV with two passengers. One of the passengers wasn’t wearing a seatbelt and suffered serious but not life-threatening injuries. Luckily, George had some auto insurance: (15/30/20). The total financial impact of the accident was as follows:
Passenger A—$15,000 medical costs
Passenger B—$35,000 medical costs
Totaled SUV—$56,000 property damage
Here’s what George’s insurance would cover and what George would have to pay out of his own pocket:
Passenger A: Insurance pays: $15,000. George pays $0.
Passenger B: Insurance pays: $30,000 limit per person, per accident. George pays $5,000.
Totaled SUV: Insurance pays: $20,000 maximum property limit per accident. George pays: $36,000.
Now… would you be able to pay $41,000 out of pocket if the same thing happened to you TODAY?
And what if you hit a more expensive car? Caused more serious physical injury or death? One instance can totally wipe you out and keep you chained in servitude of debt for years. This book is great because it takes all your basic insurance needs and spells out in not-so-exotic situations exactly how you can ruin yourself financially — often unintentionally.
And so, in my opinion is this book is worth reading if ONLY to read the scary chapters starting with “Survive….”. But the rest of it is good, too.
For these and other book discussions, check out the Geezeo “book club”: Bookworms Unite.
February 22nd, 2008 at 10:22 pm
Thanks for sharing this. I might have to check this book out. I never really thought much about the numbers on my insurance either… And I’ve already been in an accident before! But I guess I never paid much attention because I never had to pay out anything. The insurance took care of it all! (All 3 cars, and the 3 adults and two children - none of which were seriously injured - I think mine was the worst!) Anyways, yea, thanks again. I will definitely be reading that book soon!
February 23rd, 2008 at 5:58 pm
I hate this business crap, but I love horror movies!!!!!