What’s your personal financial wellness plan?
The outgoings we face today just to keep on top of the mortgage or rent, utilities, food and other regular commitments such as loans and childcare costs, can be significant.
So it’s important to plan for the unexpected and avoid making a potentially costly mistake.
We might worry about how we would pay the bills and look after our families if we were to have an accident, but the truth is many of us don’t have cover in place to protect against it. With 30% of households admitting they wouldn’t be able to pay their mortgage if they were to unexpectedly lose their income (HSBC Survey 2015), it’s clear there’s a real risk of serious financial hardship if income stops – even for a short time.
The importance of appropriate protection
Most of us buy travel insurance when we go on holiday. We insure our pets against illness and the sometimes eye watering vets bills this can incur. We insure our mobile phones, washing machines, gadgets and cars.
But all of these expenses need to be funded from somewhere, and if a sudden event affects our personal cash fow, it would be hard to see how we could keep these other insurances going – let alone all the other outgoings.
Swiss Re (http://www.swissre.com/media/news_releases/nr_20120611_Term_Health_Watch.htm) estimates that the average person is underinsured by as much as £100,000, with single parents, couples with children and the under-35s the most likely to not have the right cover. That is just an estimate – it could be higher and the pressures on average incomes mean it probably is.
Is it time to review your circumstances?
There is real value in taking time to regularly think about your personal circumstances. As you go through life, your lifestyle will change and so too will your need for protection.
There are a number of affordable protection products available that give you peace of mind in knowing your finances would stay intact. These include life and critical illness cover, income protection, insurance aimed specifically at hospital stays and treatments, as well as accident protection.
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