By Jonathan Sidlin, Financial Planner and Managing Director of HSC Financial Advisers
Few people are bold enough to come out and ask ‘How much do you earn?’, but they judge your success based on your car, your house, your clothes and the holidays you take. The challenge is that when you get a bigger house, a more expensive car or designer clothing your outgoings increase too. But what about the future?
Most of us don’t want to think about sickness and death – and retirement can seem a long way off. But if you’ve grown accustomed to a lifestyle that is dependent on your earning power, it’s important to look into the future and ask ‘what if the worst were to happen’ and explore the means to protect your future..
How to protect your future
The obvious insurance protection is life insurance, so your loved ones are not left without a safety net if the worst should happen. The recent pandemic has demonstrated that even the young, fit and healthy are not immune from fatal viruses and accidents do happen. It’s better to be covered and not need it than the other way around.
Life cover is, in my opinion, a must for anyone with a mortgage and a family. Dealing with the death of a loved one is difficult enough without the additional stress of financial hardship. Life Insurance policies give you peace of mind and protect your assets.
However, this is not the only type of insurance that I feel everyone should consider. Other policies I advise my clients to look at are income protection cover and critical illness cover.
Income protection insurance is important for anyone with a salary or who is running a business. What if you couldn’t work? How would you pay the bills? Statutory Sick Pay is only £96.35 a week – which wouldn’t pay most people’s grocery bill, let alone all the other bills. The alternative is to draw on your savings or fall in to debt.
Even if you work for a supportive company that offers full sick pay, sometimes this may be capped or be time-limited and may not be a long-term option.
Income protection insurance is a long-term insurance policy giving you a monthly payment if you can’t work because you’re ill, injured or disabled. Typically the policy pays out until you can start working again, or until you retire, die or the end of the policy term. You can opt to have a waiting period before the insurance payments start, either once sick pay ends or any other insurance stops covering you.
Different policies have different criteria and the monthly premium you pay will reflect the level of cover you choose.
Critical illness cover is slightly different. This cover can provide cash to allow you to focus on recovering from the illness, without adding unnecessary financial stress into your life. It will allow you to continue with your lifestyle and can also cover modifications to your home, therapy or care expenses.
You can take out critical illness cover as a separate policy or as part of a life insurance policy. It’s designed to pay out a tax-free lump sum on diagnosis of certain life-threatening conditions.
Get professional advice
I strongly recommend that you seek advice from a professional before selecting your insurance cover. There are so many policies to chose from and without specialised help you may end up paying into one that doesn’t completely cover your needs – and may even cost more than you need to pay.
The future is tomorrow and when you’ve worked hard to build the career and lifestyle you want, don’t let it be taken away by something that life throws at you. Live for today, and plan for tomorrow – take control of your future, whatever happens.
Disclaimer: This is information only and does not constitute advice. Pensions/investments are medium to long term plans and are not guaranteed as past performance is not necessarily a guide to future performance. The value of units can go down as well as up. Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change.
About Jonathan Sidlin, Financial Planner and Managing Director of HSC Financial Advisers
Jonathan Sidlin is a standout financial planner whose proven track record helps his clients build wealth in order to achieve long term financial success. Jonathan is not your ordinary Financial Adviser. He believes every person should be educated about personal finance from an early age to ensure they are presented with the best opportunities in life. It is this unique combination of education and strategy that helps his clients increase their personal wealth and ensure their protection needs are met. Jonathan provides his clients with the confidence to follow a long-term financial plan, guiding them at regular intervals with the aim of becoming financially secure.
Jonathan is a Chartered Financial Adviser who graduated from the London Institute of Banking and Finance. His expertise covers most areas of the Financial Planning process, including Pensions and Investments, Tax Efficient Products and Estate Planning Solutions. With an increased focus on sustainability, Jonathan is working to bring more ESG investment options to his clients.
Jonathan’s clients come from all walks of life and include all ages. Whether it’s a first-time buyer looking to purchase a home, individuals and business owners looking to grow their wealth, or a retired person wishing to draw an income and/or provide for the next generation, Jonathan has strategies for each unique situation.
Jonathan believes that financial success is built around a basic understanding of money and the choices individuals make when it comes to their finances. Jonathan works with his clients on a personalised basis taking them on a journey to create a tailored financial plan.
Jonathan offers uncomplicated, authentic advice and prides himself on being down to earth and jargon free. His goal is to make financial wellbeing accessible to all and enable more people to achieve long-term financial freedom.
