A black swan is something rare and unusual. In economic terms, it is defined as an unpredictable or unforeseen event, typically one with extreme consequences. Investors spend a lot of time and worry about when another black swan will occur, such as 2008. But rarely do people consider other exceptional circumstances that could equally impact them besides what happens with the stock market.

Federal employees just recently encountered a black swan with the government shutdown. Not many people take a federal job and worry about their employment. Perhaps this is why you heard about thousands of people on the news that were not prepared to go 35 days without a paycheck. I am certainly not condoning a government shutdown, just noting the lack of preparedness many people face.

There are hundreds of black swan examples in life. Death, disability, and diseases, especially at a young age, are some obvious ones. It is virtually impossible to plan for every event, so identifying what you can prepare for and knowing what you can’t is the crux of every good financial plan.

The first thing your financial adviser is typically going to recommend is a financial safety net or emergency reserves. The amount is usually three to six months of living expenses depending on your situation. This is money that is not invested, but in reserve in a secure and liquid account. Although these reserves often do not generate interest, that is not the purpose of these funds. The purpose is to be readily available to you for a black swan event, including the stock market kind.

Regardless of your current age, you know you are going to die at some point. Hopefully you are never sick or disabled, but you will die. Yet millions of people have not prepared for their death and are grossly underinsured. This is an example of what you can plan for. You can create an estate plan, leaving instructions to your family and your heirs. You can keep your personal representative informed of your financial situation and other prudent facts that maybe only you know. You can purchase the right amount of life insurance your financial plan calls for. It is important to continually review and assess these provisions as well in relation to your personal situation.

Likewise, regardless of how sophisticated of an investor you are, there will likely be times when you wish you weren’t invested. The answer is not to do nothing, in my opinion, it is to build a portfolio that can help withstand a black swan event. By doing so, the foundation of this portfolio can serve as your emergency fund and you can build other assets on top of that base, perhaps starting with the most conservative investments and adding layers for longer-term goals. That long-term money can help take the brunt of a black swan event, and your short-term money can help outlast possible declines and recovery periods. This way can help you get the benefit of earning power if in a well-diversified portfolio without jeopardizing the ability to keep up with future inflation.

No one can predict the future. But we can identify what things we have control over and take care of those first. When you have your basic needs covered, the chances you will survive the unknowns are now greatly increased.

Patricia Kummer has been a Certified Financial Planner and a fiduciary for over 30 years and is managing director for Mariner Wealth Advisors, a Registered Investment Adviser. Please visit www.marinerwealthadvisors.com for more information or refer to the Investment Adviser Public Disclosure website (www.adviserinfo.sec.gov). Securities offered through MSEC LLC, Member FINRA & SIPC, 5700 W. 112th Suite 500, Overland Park, KS 66211.