• Cash reserve for short-term emergencies, such as a temporary job loss, major home repair, or large medical bill. A common rule of thumb states that your cash reserve should equal two to six months of living expenses. However, how much you will need depends on your age, health, job outlook, and borrowing capacity. You may need a larger reserve if you expect to be laid off or lose your job, you are the sole wage earner in the family, or your income fluctuates. A smaller reserve may be needed if you have more than one source of family income or you can borrow quickly, such as through a home-equity line of credit.

• Adequate insurance in all major areas. Your insurance needs will change over the years, so you may find yourself with too much or too little coverage. Thus, periodically review your life, disability, medical, and homeowners insurance. Do not overlook disability income insurance, which can be very important if you can not work due to an illness or injury. Make sure your coverage replaces 60% to 80% of your income, cannot be canceled, and pays partial benefits when you can not return to work full time. For a selection of insurance providers visit the ManagingMoney.com Insurance Directory. Here you will be able to shop for and compare heath, life, auto, homeowners insurance, and more.

• Umbrella liability insurance to protect against major lawsuits. Umbrella policies are purchased in $1 million increments and kick in once limits of your homeowners and automobile policies are exceeded. In addition to the items covered by those policies, an umbrella policy typically covers damages from use of nonowned property in your possession and from lawsuits for libel, slander, defamation of character, and invasion of privacy. While you might think you will never need this coverage, most umbrella policy claims relate to automobile accidents.

• Power of attorney. A power of attorney gives an individual you designate the power to act on your behalf when you are incapacitated, allowing him or her to take over your finances and make investment decisions. For do-it-yourself legal solutions visit ManagingMoney.com's Legal Center. The Legal Center provides not only Powers of Attorney, but also, Wills, Health Care Directives, Trusts and more.