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After watching one of my daughters break the Cardinal Rule (or should I call it Ravens Rule, since it came from a Carleton coach?) of basketball, I figured I'd reprise one of my favorite financial planning articles from the past, enjoy!

So one of my sidelights is coaching basketball, and I love going to clinics from coaches who talk about coaching and plays and stuff (I'm an old gym rat at heart). Last Saturday I was lucky enough to hear from Dave Smart who is the head coach at Carleton University (the Ravens have been Canadian Champions the last 3 years running), and he was fascinating to listen to. Coach Smart admits to being a perfectionist and telling it like it is, and one of the expressions he tells all of his players is "Don't Pass the ball to the other team".

The first time you hear this expression it sounds obvious, of course, who would do that, but what Coach Smart was trying to say (I think) is most basketball players watch their own players, but rarely see the other team's players. If you watch the defensive players, you won't pass it to them! Simple, right? No! You know where the offensive player is going to go, you don't know where the defender is going, and you need to watch them!

What does this have to do about finances? (Darn good question, get ready for a stretch here) Don't take your eye off things that you can't control, the stuff you can control, your savings, your retirement, your investments, your debt reduction plan, if they are under control that is good.

You have to plan for the things you don't control, and that means:

• Reduce DEBT! You can't control interest rates, you can't move forward with your car in reverse. Debt reduction is first and foremost. Everything else can be dealt with much more easily if you are carrying little or no DEBT!!!
  
• Have contingency funds in place for:
• Car repair. I am guilty of that one, car repair bills always throw me off kilter
• House repair. I am going to get a major bill to replace the roof and furnace on my house, but they had to be done. If your house is new, you'll need to replace these things in 15 years, but in 15 years, if you haven't saved any money for it, it's going to HURT!
• Catastrophic illness. I have long term disability insurance with my company just in case. If I had a stroke tomorrow, my family would at least have an income of some kind.
• Loss of employment. If you lose your job, how long will you last? A priest once told me everyone is 12 weeks away from living on the streets, make sure you are not one of those folks
• Death! Term insurance to protect your family, and a will to protect them even more (thanks Dividend Guy, for pointing out I missed that).
  

These are SOME of the unknowns, that you need to watch for, and not pass the ball to them!

Hope for the best, and plan for the worst! --C8j

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