Recent research from one of the UK’s major insurance companies has found that more than 30 percent of UK adults are forced to take an extended leave from work due to ill health, a cancer diagnosis or the death of a close family member. Even more sobering is the fact that over three quarters of those affected saw an immediate and significant impact on their family finances. When you work through the numbers, that comes to around 12.3 million people whose financial stability is rocked by ill health. It is something that could affect any one of us – so what can we do to protect ourselves and our loved ones?
Get into the habit of saving
In today’s society of zero hours contracts and freelance gig work, some of us have a tendency to live in the moment and leave tomorrow to take care of itself. Deep down, we know that when we have a family to consider, that’s not the most responsible of attitudes to adopt. Making small financial sacrifices today could make a world of difference tomorrow. So open a savings account, put what you can away into an tax free account and take the first steps towards protecting your children’s futures by opening Junior ISAs on their behalf.
Take out insurance
Given the authors of the report mentioned above, it will come as no surprise that this was the first recommendation on their list! Nevertheless, even from a completely impartial perspective, there is no denying that it makes sense. A life insurance policy can spell the difference between stability and poverty for your family if the worst happens. There are also income protection policies you can take out if you are self employed. Well worth considering if the household income is reliant on your ability to work.
Stay on top
Life doesn’t stand still, and the arrangements that seemed perfectly adequate when you put them in place five years ago might not be up to the task today. Get in the habit of reviewing all your finances whenever there is a significant change in life, for example the birth of a child or moving to a new home.
Keep a long term focus
Sometimes, there are short-term gains that look mightily tempting, but can really put a spanner in the works further down the line. Accessing pension funds at the first available moment is a prime example. Sure, sometimes that is the right thing to do, but look at all options and from all perspectives before following a course of action that you might regret later. If in doubt, talk to an expert – that’s what independent financial advisors are for.
Discuss it with loved ones
Money, illness and death are not everyone’s favourite topics of conversation across the dinner table. Nevertheless, this is important, so you need to discuss what your family would do if you suddenly fell ill, or worse. It might feel like an awkward topic to raise, but you will feel that a weight has been lifted from your shoulders when you do so.
Thank you for reading.