PROTECTING YOURSELF AND YOUR FAMILY'S FINANCIAL WELL BEING
Sometimes,
you know that you need life-cover e.g. when your mortgage
requires it.
Sometimes,
you know that you want to protect someone valuable to you: your spouse,
family or perhaps, your business, but you don't know how to begin.
A good place
to start is to identify the risk and then try to quantify it; consider
some of the following questions:
- What is
the risk:
- That
you will be seriously ill, leaving no income to your spouse or family?
- That
you might die suddenly and leave the mortgage unpaid?
- Who is
vulnerable:
- Who
will actually suffer, if the income is not there?
- Quantify
the risk. Would a lump sum satisfy the need, or an income?
- How much
would be needed?
- How long
will you be vulnerable?
- Is there
a debt that would need to be cleared e.g. a mortgage or bank loan?
- Is there
a potential debt e.g. an inheritance
tax bill that would occur on death?
- If a payout
is made, who do you want to receive it?
- Who
should have control?
- When
and how do you want the benefits delivered?
If you can
answer some of these questions, then it puts you in a good position to
sit down and discuss the matter with a financial adviser.
Sometimes
you may decide that there is no financial risk and no action is needed.
More often,
you will see clearly where you need to put cover in place.
The next
step is to talk to a financial adviser to clarify the need and he/she
can quantify the cost for you. Then you will want to balance the cost
of protection versus the risk, before you take any action.
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