Scenario Planning

What is scenario planning?

There are probably many definitions out there of scenario planning. I see it as thinking through your life, letting your immagination run wild on how things could go wrong. Not for the sake of worrying yourself to death, but to think through possibilities, ultimately identifying ones you think are real enough that you want to put something in place to be ready for the scenario. 

For example. I live in a colder climate and use natural gas for heating supplied by a utility. What might go wrong? This is the place where you can let your immagination go wild and come up with some very low probability stuff. Could aliens come down and take the gas line out of your yard because they need 10' of hdpe for a repair project on their ship? Well, maybe but it's pretty far out there. Don't be afraid to challenge yourself to think through the more outlandish things. Maybe some examples:

1. You have your gas bill set up on auto pay to hit your credit card. Meanwhile you someone steals your credit card number, so you tell the credit card company, they issue you a new card. Now your card on file with the utilitiy is out of date. So they go to charge you and the charge won't go through so they shut off your gas. Likely they'll work with you to get the credit card updated before shutting you off but the point stands. Your gas is out because your credit card info wasn't current. 

2. The frost in the area gets extra deep from a cold winter and freezes a water line. The utility comes out to dig the frozen water line and hooks the gas line. Now you're out of water and gas. 

3. Someone crashes a car into a house taking out their gas lateral which forces the utility to shut down the whol area's worth of gas to get it replaced. Now you're out of gas. 

4. Frost heave occurs in your gas line creating a leak. Now you're out of gas and have to evacuate. 

5. The gas meter just straight fails

6. Kids shut off the gas valve to your house

7. A pipeline transporting natural gas experiences a failure resulting in a regional gas supply outage. 

8. Furnace malfunction. Now you don't have heat

9. Power outage. Now you don't have power to run your funace

10. Water line bursts causing damage to your furnace or places it under water. Now you don't have heat. 

11. Snowblower hits the gas line coming into the house. 

12. The utility company defaults on it's debt and shuts down, shutting off your gas. 

13. A meteorite hits your gas meter. 

14. Aliens steal 10' of gas line from your yard to repair their ship.

So there you go. A bunch of ways you could experience a gas/heating failure at your home. That's Part 1. Part 2 is "which of these scenarios do you actually want to plan for?". I have to think a malfunction in your furnace (bad board or ignitire or rollout switch) would be the most likely. On the other end of the spectrum, i'd say your more likely to get hit by a meteorite than aliens needing that 10' of gas line for a ship repair. So for example, out of all that are listed, I think my utility company is pretty solid, no meteorites are coming my way, and I don't think aliens want my gas line but I'd like to be ready for each of the other scenarios on the list. So now I've decided what scenarios I want to be ready for. Part 3 is to decide what I'm going to do to mitigate each of the unfavorable scenarios. So here are some thoughts:

1. You have your gas bill set up on auto pay to hit your credit card. Meanwhile you someone steals your credit card number, so you tell the credit card company, they issue you a new card. Now your card on file with the utilitiy is out of date. So they go to charge you and the charge won't go through so they shut off your gas. Likely they'll work with you to get the credit card updated before shutting you off but the point stands. Your gas is out because your credit card info wasn't current. Mitigation: I'm going to put a second credit card on file with the utility in case the first one doesn't work. 

2. The frost in the area gets extra deep from a cold winter and freezes a water line. The utility comes out to dig the frozen water line and hooks the gas line. Now you're out of water and gas. Mitigation: I'm going to establish an electric heat backup for my home. I know how big it is, I'll figure out how many space heaters are needed to heat the critical areas of the house, I'll keep those heaters on the shelf in the basement

3. Someone crashes a car into a house taking out their gas lateral which forces the utility to shut down the whol area's worth of gas to get it replaced. Now you're out of gas. Mitigation: I'm going to establish an electric heat backup for my home. I know how big it is, I'll figure out how many space heaters are needed to heat the critical areas of the house, I'll keep those heaters on the shelf in the basement

4. Frost heave occurs in your gas line creating a leak. Now you're out of gas and have to evacuate. Mitigation: I'm going to have my gas line replaced with the most flexible pipe out there, buried in the smoothest soil so there'll be nothing for it to pinch on and it will flex instead of breaking

5. The gas meter just straight fails. Mitigation: I'm going to establish an electric heat backup for my home. I know how big it is, I'll figure out how many space heaters are needed to heat the critical areas of the house, I'll keep those heaters on the shelf in the basement

6. Kids shut off the gas valve to your house. Mitigation: I'm going to learn out to do basic troubleshooting so I know how to turn the gas on and off. I'm also going to install a security system on the house so I can look back and see when the kids actually shut it off. 

7. A pipeline transporting natural gas experiences a failure resulting in a regional gas supply outage. Mitigation: I'm going to establish an electric heat backup for my home. I know how big it is, I'll figure out how many space heaters are needed to heat the critical areas of the house, I'll keep those heaters on the shelf in the basement

8. Furnace malfunction. Now you don't have heat. Mitigation: I'm going to learn basic to advanced troubleshooting for my furnace. I'm going to have key critical spare parts on the shelf. 

9. Power outage. Now you don't have power to run your funace. Mitigation: I'm going to buy a generator and have the correct hookups to power my furnace.

10. Water line bursts causing damage to your furnace or places it under water. Now you don't have heat. Mitigation: I'm going to buy enough sump pumps to pump my basement out in an hour. I'm going to have enough eletric heaters to heat my home while my furnace dries out. I'm going to learn how to repair my furnace. I'm going to have critical spares for my furnace on the shelf.

11. Snowblower hits the gas line coming into the house. Mitigation: I'm going to put a protective cage around all exposed gas equipment so getting bumped by a snowblower or lawnmower doesn't do anything.

12. The utility company defaults on it's debt and shuts down, shutting off your gas. Mitigation: I've decided it's a low enough probability I'm not going to put a specific mitigation in place for it.

13. A meteorite hits your gas meter.  Mitigation: I've decided it's a low enough probability I'm not going to put a specific mitigation in place for it.

14. Aliens steal 10' of gas line from your yard to repair their ship.  Mitigation: I've decided it's a low enough probability I'm not going to put a specific mitigation in place for it.

With all of that said, I now know what I plan to do. So naturally the last step is to put all these in place. This is a whole nother task. If we were millionaires, it'd be a matter of writing a check to someone to come over and do all the things and drop off all of the mitigation items. Buuuut we're not. So that's where some Budgeting and Financial Planning come in. Check that page out. Figure out your plan on how to get the mitigations in place and make it happen. 

Another component of this is realizing many scenarios might point to common mitigations. In the example above, there are several scenarios which led me to want to have a cache of electrical heaters ready to use. Kill many birds with one stone. There are two additional things to think about here. First, since there are many scenarios that suggest I should get heaters, maybe I should prioritize this, and get the heaters as a higher priority in my budget. The other thing is going back and looking at some of the other scenarios to see where might buying extra heaters cover that scenario, and now that I have the heaters I can change my mitigation for that scenario to heaters so now I'm covered. In addition by buying the heaters and having them on the shelf, that's probably a good mitigation for aliens stealing 10' of gas line out of my yard, so I'm probably now covered for that scenario even though I decided it was so outlandish that I decided not to put a mitigation in place. 

So In summary, the process is:

1. Think through an area of your life and ways it can go wrong. 

2. Decide which of those scenarios you want to mitigate

3. Decide what your mitigation is going to be for those scenarios

4. Re-evaluate coverage of scenarios by mitigations you've already decided you want to put in place

5. Budget and put the mitigation in place.