Ponant is a French cruise company, a pioneer in luxury expedition cruises to remote locations like Antarctica and Arctic regions. Intimate yacht-like ships such as Le Boreal and Le Soleal generally carry about 250 passengers and crew. Expedition cruises feature expert naturalists and guides using a fleet of onboard Zodiacs to land passengers in pristine and remote locations for hiking, exploration, beachcombing, photography, snorkeling, as appropriate. As you might imagine, Mother Nature has substantial influence over itineraries, landings, and activities.
The Northwest Passage is a fabled sea route linking the North Atlantic and North Pacific oceans. The westward route takes ships from Baffin Bay between Greenland and Canada, past numerous islands north of mainland Canada, through the Beaufort Sea and Bering Strait to ports in Alaska and western U.S. Long a coveted “short cut,” being above the Arctic Circle the passage has been long blocked by sea ice. Generally considered impenetrable, several years of warming reduced ice development. In 2016 a luxury cruise ship, Crystal Serenity, made the crossing carrying about 1,000 passengers who paid handsomely for a “be first” experience.
This summer, however, ice returned, cheering those worried about global warming. Canadian authorities closed the Northwest Passage. Ponant had Le Boreal and Le Soleal scheduled to sail from Kangerlussuaq in Greenland to Nome, Alaska. The ships then were to operate a series of cruises in Alaska and along the American west coast and on past Central and South America, ending up in Ushuaia, Argentina, to kick off the upcoming Antarctic cruise season. Instead the vessels were forced to sail from Greenland to west coast American ports via the Panama Canal to resume scheduled cruises.
Le Soleal, for example, motored for 18 days from Greenland with the full crew and only seven passengers, through the Panama Canal, then northwest to San Diego. My wife and I boarded the ship in San Diego for an exploration of Mexico’s Sea of Cortez, disembarking in Guatemala. Ponant had to refund fares on several cancelled trips, reimburse other expenses, and move the ship. The toll for the Panama Canal alone costs $8,000 US. A passenger who made the long voyage said she heard the rerouting costs, including lost revenues, approximated $11 million dollars. Whether that estimate is correct or not is irrelevant. The point is, whether a ship or airplane, rerouting is expensive!
The story is a metaphor for life. The poet Robert Burns warns, “The best laid plans of mice and men often go awry.” The insurance industry thrives on uncertainty. “Stuff happening” can be expensive. Prudent financial planning demands levels of insurance appropriate to your net worth, liquidity levels, and risk exposure. Given a major health or other life altering setback, or death, what is the potential impact on loved ones, others who depend on you, including your family and your “work family” if you are a closely-held business owner or key person? Where do you stand on various forms of insurance coverage—life, disability, health, long term care, liability, including Umbrella Liability? Travel agents recommend trip insurance. Pet insurance on Rover or Whiskers the cat?
Even with insurance, improper positioning can be expensive. Making life insurance payable to your estate can open the settlement to creditor claims. Certain forms of trust planning can decrease settlement costs while providing clarity on distributions. This is critically important concerning special needs minor or adult children, or offspring with spendthrift or substance abuse challenges. Failure to a have current and properly drawn will, powers of attorney for assets and health care, and an advance directive will cause expensive and mentally draining complications. How you title property as to ownership and primary and contingent beneficiary designations, matter.
Remember, a will only works when you’re dead, not when you are comatose or otherwise unable to act in your own behalf. Planning failures are “reroutings” not welcomed by family, loved ones, employees, anyone who depends on you!
For those starting out in life with career plans, and especially, marriage and family formation, we urge creation of a Freedom Fund, enough cash or other liquid capital to get you through a crunch without going into debt. Crushing debt kills the soul and destroys relationships and families.
Know yourself. You might use the Clifton/Gallup Strengths Finder process to identify your God-given talents to which you add skill and knowledge to create strengths. See the book, Strength Finder 2.0 by Tom Rath, a national best-seller. If you approach life using your strengths, especially in your career, you increase the odds of financial success and personal and family security. “Living your strengths” has the same effect on wellbeing as does physical fitness in warding off or minimizing sickness. Fiscal and physical fitness count!
Keep traveling! Patience and flexibility count. Ice happens!
Lewis Walker, CFP®, is a financial life planning strategist at Capital Insight Group; 770-441-2603. Securities and advisory services offered through The Strategic Financial Alliance, Inc. (SFA). Lewis Walker is a registered representative and investment adviser representative of SFA which otherwise is unaffiliated with Capital Insight Group. He is a Gallup Certified Strengths Coach and a Certified Exit Planning Advisor (CEPA®).