Old Backup Plans are even more dangerous than no Backup Plan… They give a false sense of security

The other day I  drove to a meeting that required me to cross a river I hadn’t crossed in several years. No problem… I reflexively plugged the meeting address into my car’s Satnav system and followed the map on the dashboard. As I approached where the bridge was supposed to be, my Satnav became confused. It indicated that I was on a different access road to the one I knew I was actually on. 

The reason? The bridge that existed in my Satnav’s software wasn’t there anymore!

old backup plans like out of date satnav software
Without up to date software you could be on the road to nowhere…

It had been replaced by a new bridge. This was parallel to it but with totally different access roads. Had I strictly followed my car’s existing Satnav, I would have gotten lost… or worse… had a serious accident. Clearly it was time to update my car’s Satnav software! This got me thinking about the world as we embark on 2023.

Backup Plans need to alter to reflect global changes

It is no exaggeration to say that it is a very different place than it was 10 years ago… or even five. To name just a few recent significant shifts we’ve had COVID, Brexit, Ukraine, climate change disasters happening sooner than predicted, inflation, tribalism, the threat of a global recession and the resulting political and economic uncertainty.

Backup Plans should reflect recent global changes brought about by events such a covid 19
Covid 19 and other recent global and local events have hugely changed the political and economical landscape.

Since our firm’s inception we have worked closely with clients to ensure they have backup plans. These are designed to safeguard the security of themselves and their families in the event of a social, political or economic wildfire.

What Backup Plans should include

These Backup Plans normally address both the family’s present and future concerns and goals. They always include for every family member a detailed departure / escape plan (how to ensure they can leave, where to go, how to get there) and a survival kit / insurance plan (that includes alternative residency and/or citizenship, suitable accommodations, proper schooling for the children, a place to conduct business…and of course, ready access to their funds). This ensures that the family can resume its normal functioning as soon as possible following its successful departure. 

My experience with the disappearing bridge and my out-of-date Satnav reminded me that without an up-to-date map, an escape plan is pretty much useless… indeed it could lead to even more problems. So it is essential that all backup plans be reviewed and updated regularly to ensure that they will perform effectively for every family member if ever needed. This is especially true in a world that is very different from the one when their backup plan was created.

What new actions should you consider?

As we start the new year, let me therefore list some of the actions anyone with a backup plan should consider carefully – and, if necessary, update – to ensure that their plan is fit for purpose today… and will be as fit as possible for the near future.

Here are some things to consider:

  • Government and society change. New laws or events may make current or intended destinations undesirable, unstable or even dangerous;
  • Families grow. Children grow up, get married, have children of their own, get divorced, get remarried, grandparents get old, some become infirm and some sadly pass on;
  • Family members relocate. This happens for a variety of reasons: education, family, career, lifestyle…and of course security;
  • Laws change. Taxation, citizenship, residency laws change. Sometimes this is with positive effect, sometimes with negative;
  • Passports need renewing. Not only can this take a lot longer these days, but more importantly, they can always be cancelled by the issuing country that owns them;
  • Important personal documents get forgotten – or lost. When was the last time you saw your birth certificate (or adoption papers), marriage certificate, will, etc.? ;
  • Financial situations change. Not just in terms of value, but how the family’s finances are organized and managed. There may also be change in where they are located and how they are taxed;
  • The health of family members can change. This can prompt or limit travel and residence;

If any of these considerations apply to you and your family – then it is highly likely your backup plan needs to be revised. It’s imperitive that you address them, not only for the present, but also to provide for an unpredictable future.

How to review your Backup Plan

For the review step, let me offer a few thoughts: 

1) Get professional assistance that covers ALL of the possible issues that need to be addressed.

This will involve not only immigration and citizenship but also taxation, family law and even security concerns.  This holistic view will ensure that all the necessary material changes have been addressed. It will also identify additional issues, options and new opportunities. In a previous blog, I discuss this in greater detail.

2) Enlist the inputs of key business confidants

It is important to ensure their support and business continuity.

3) Enlist the inputs and support of family members.

We always say that Backup Plans are not just approved at the boardroom table… they are approved at the kitchen table.

4) Recognize that delaying a decision is in reality making a decision…to do nothing. 

Of course, we are not suggesting doing something just for the sake of doing something. However, once the horse has fled the barn it is too late to close the door. In these continuing COVID days, lead times to execute a backup plan are a lot longer. This is apparent in the time taken to get documents from a government or have a government process an application. What took six months pre-COVID can now take upwards of a few years. Therefore delaying a decision can often be the riskiest, not the safest, option.

5) If a viable option is available, don’t wait for what you hope will be a better one.

We have a client – a legitimate and highly successful businessman – who was justifiably reluctant to get important personal documents legalized in his home country. He was afraid of drawing the attention of its autocratic government. When a viable solution was presented, he hesitated in the hope the risky situation would improve in his home country… or that the viable solution would continue indefinitely. Neither happened. Now his options and those of his family are very limited. The government is refusing to legalise documents as they exert control over their citizens. 

6) And finally, plan for the worst…even though you will continue to hope for the best. 

To effectively do this, speak with your various advisors. Get them to identify “the worst that could happen” in their particular area of expertise. Don’t be afraid to call them out if they are too general and vague. Now is the time to get granular… to fully identify and understand the risks and develop a mitigation plan to add to your master backup plan.

Don’t risk losing out by being out of date…

So just like the Satnav in your car that needs its software updated to reflect the new reality on the road, if you want your existing backup plan to efficiently and effectively get you and your family to your inte

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