Why Protection is an Essential Part of your Financial Plan
When you sit down to outline your financial plan the first topics that probably spring to mind are pensions, savings, and investments. Often overlooked, financial protection should also be a solid part of your plan.
What is Financial Protection?
Protecting your finances comes in the form of insurance policies that pay out under certain circumstances. These policies are there not only for the security of your finances but also for your loved one and your own peace of mind. Your priorities and circumstances will determine which insurance products are the best suited to you.
Types of Products
- Life Insurance – In the case of death, life insurance will pay out a lump sum. As it will also do in some cases for terminal illnesses. Life insurance can provide some security while easing the strain on your loved ones during this extremely challenging time. There are various levels to choose from to ensure that you can meet your needs.
- Income Protection – If you ever find yourself in a situation where you are unable to work for an extended period then this policy could provide you with regular monthly payments. These payments can often carry on until you are able to go back to work or even until you retire. This type of security is particularly important as you never know when unforeseen events may occur, leaving you struggling to uphold financial commitments.
- Critical Illness – Covering certain illnesses, this policy may also provide payouts. It is essential to have a comprehensive policy to ensure you are covered where possible. As with most types of insurance. You will not know you need it until it is too late, so it is best to act as soon as possible.
Why is Protection so Important?
- It can act as a safety net
So often in life, things do not go according to plan. By expecting the unexpected, you will be in the best position to avoid financial vulnerability. It is always a sound idea to keep some savings back in case of emergency but protecting your finances is another way for you to cast your safety net even further.
Ask yourself if you could survive for the next six months if you were to stop working today. Whether you would find yourself struggling. An insurance policy would be able to provide the help you need, meaning that you would not have to worry about being able to afford the essentials during what could be a tough time.
- Allows you some time to adjust
When you are struggling financially due to taking time off for your health, it can be very tempting to go back to work sooner rather than later. Income protection will allow you to have some breathing space where you can take the time you need to recover or to make necessary adjustments. Some accidents or illnesses will leave a long-term impact, while financial security can cushion your fall so you don’t have to rush into making life changing decisions.
- Puts your mind at ease
You are already thinking about financial planning, making sure that detailed plan also includes protection will put your mind at ease. Taking out an appropriate policy is the first step to making sure you can stay on track financially even when things go off course.
- Protect what is most important to you
What or who are you the most worried about if something unexpected were to happen? Some people may be worried about their family struggling to keep up with the mortgage payments. Others worry about how their family will stay afloat without an income to rely on. Investing in insurance can ensure that who and what is most important to you will stay protected.
What will Protection Cost?
It will depend on the provider you go with as to how much financial protection will cost you. Payments need to remain up to date to keep the coverage valid. Once you have a decent level of protection in place you can investigate the rest of your financial plan. Securing your finances will give you confidence in knowing that even if something unexpected pops up, you can still stay on track.
Summary
Having no security can put you at a higher risk, and you could end up paying through the roof for it down the line.
Speak to one of our Wealth Managers today about Financial Planning and how to implement the necessary security measures. Private Client Consultancy Insurance offer a range of products for the benefit of yours and your loved one’s protection.
Contact info@pccwealthinsurance.com for more information.
