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The Importance of a Good Backup (Financial) Plan

May 8, 2021

Marcel LeBlanc, CFP®, CIM®

Life happens... Here's a few tips on how to best accommodate unexpected life changes from impacting your finances.

Sometimes Plan A doesn’t work out as expected. I was biking the other day when I noticed my front tire was low on air. I decided to stop at a public service station. The pump was broken and deflated my front tire. Naturally, I started blaming the city’s faulty pump for the situation I found myself in.

But it wasn’t their fault I was stuck pushing my bike. I had a portable pump and spare tubes at home but didn’t bring any of them with me. I had chosen to forego my backup plan and put all my eggs into Plan A working perfectly.

In dealing with your finances, it’s easy to blame others when things don’t go your way. It’s easy to blame your friend for recommending an investment that did not work out.

But who’s to blame? Life or your preference for Plan A?

When it comes to managing your personal finances, some of us are attached to our current plan without assessing the impact of uncontrollable circumstances derailing this plan and having a devastating impact on our financial goals. When things are going well, it’s easy to forget that they won’t necessarily stay that way. We get comfortable, we get complacent, and we become oblivious that bad things can happen to good people.

So, if we can agree that life could have a few curveballs in store for us, it’s likely a good idea to have a backup plan in case Plan A doesn’t work out. You’re likely to benefit from having a Plan B or Plan C, if something unexpected gets in the way of Plan A working out like you thought it would.

The good news is that the financial consequences of many of life’s uncontrollable and unexpected events can be managed with proper planning. With various income streams, one can manage to get by if one of them is taken away. With enough savings, one can weather the storm of unexpected expenses. With proper insurance coverage, one can deal with the added costs of prolonged illness. And with a good variety of assets accumulating for retirement, one can afford one of their investments to fail. These are just a few examples of how taking a step back and assessing Plan A’s potential weaknesses is necessary to take proactive action and avoid blind spots from becoming a financial nightmare.

This is not to say that you shouldn’t bet on yourself and double-down on your plan A. Far from it. What I mean to communicate here is that betting on Plan A has a cost. If you really want it to work out, then you should be willing to have a look at its weaknesses and your readiness for unforeseen and unexpected events should they happen.

I wasn’t responsible for the pump malfunctioning that day. But if all I did was complain about the city’s oversight, I’d be no better off next time around. Most of our circumstances are a result of our decisions.


Marcel LeBlanc, CFP®, CIM® is a Financial Planner and Associate Portfolio Manager with Louisbourg Investments. You can find more from him on Facebook and LinkedIn. Comments or questions may be submitted to Marcel at, or he may be reached at (506) 383-5204

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This writing is for general information purposes only and is not intended to provide legal, accounting, tax or personalized financial advice. If you are not sure how to proceed with a request for further information, seek help from a professional. Any opinions expressed are my own and may not necessarily reflect those of Louisbourg Investments.

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