Plan for the ones you didn't pick

In Forrest Gump (1994, directed by Robert Zemeckis), Tom Hanks plays Forrest, who sits on a bench at a bus stop in Savannah and tells his life story to whoever happens to sit down next to him. Along the way he says the line most people can still finish for you: “My Momma always said life was like a box of chocolates. You never know what you're gonna get.” The American Film Institute later ranked it among the hundred most memorable quotes in American film.

Most money plans are written as if we did know which chocolate comes next. The savings plan runs, pay rises a little, the rent stays manageable, and every row quietly assumes you will be fit to work every single month. That is fine as long as you also run the plan once for a bad year. Germany’s Verbraucherzentrale (consumer advice centres) point out that losing the ability to work through illness or an accident usually means a sharp drop in income, and they cite the statutory pension insurer: one in five people starting a pension there now receives a reduced earning capacity pension. For anyone who lives on their earnings, they call disability income cover the most important private insurance alongside personal liability.

You don't have to buy anything today. Start with two plain questions instead: which costs would keep running if no salary came in for a year, and what do you already have that would pay out? As a guide for the size of a disability pension, the Verbraucherzentrale often suggests about 80 per cent of your current net income. The details are on our page on disability income protection, and the Weekly One income is not a plan explains what the state pays when earnings stop. The order stays the same: understand where you stand and whether you have a buffer, protect what would be hard to replace, build from there, and review as life moves on.

Patrick is 39, runs a bakery in Regensburg as a master baker, and has been starting work at three in the morning for twenty years. A few Sundays ago he built a spreadsheet: a savings plan for the two children, money set aside for the new roof, a small amount for retirement. He was quite pleased with it, because for once everything fitted on one screen.

Then Markus, his journeyman, is signed off with a slipped disc. Two weeks at first, then nobody can say how long. Shaping rolls the next morning, Patrick wonders what his own spreadsheet would look like if he were the one at home. That evening he adds a second tab and calls it “If I'm out”. Most rows he can simply copy across, since the loan, the electricity and the childcare carry on whether he bakes or not. The income column is a lot emptier. Right at the bottom is an old policy from his master-craftsman course, and all he remembers about it is that the paperwork is somewhere in the wardrobe.

Before he goes looking, he rings his mother and tells her about the new tab. She is quiet for a moment. “Your father worked everything out too,” she says, “everything except the winter he couldn’t stand up.” Patrick thanks her, hangs up, and fetches the stepladder for the top shelf.