Nowadays, it can seem that much of what we earn is needed
for normal
day to day living and this can result in little or no
surplus income
to save for a rainy day.
In effect we can be likened to a gigantic money making machine
which
pays out an income every month or week. But of course
if we had such
a machine we would probably want to insure it
against failure (wouldn't
we?).
Imagine if the unthinkable happened to you. You are struck by
an
illness or perhaps you have an accident. The result is a
permanent
disability.
If you are employed your employer may
pay your salary for a short
period, but what then?
If you are self employed, you have no
such lifeline.
Of course the State would be there with minimal support
(approximately
£4,200 per annum after a year's illness - how long would that last?)
A worthwhile exercise may be to add up total non discretionary
expenditure
(expenditure which you must make such as mortgage, loans and utility bills).
Then take away the £4,200 above. Whatever is left is the monthly
shortfall.
Statistics show that men are more likely to be away
from work as a
result of illness than they are to die! For women it
is even greater
odds. So the risk is not imagined.
If you are concerned about this aspect of financial planning, contact
us and we'll get in touch, or call us direct on 01324 832
715. We will then give you our thoughts.
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