So you have the dream job, nice car and big house, but is your lifestyle sustainable? Do you have the products in place if the worst were to happen?

Published On : 02/15/2022

By Jonathan Sidlin, Financial Planner and Managing Director of HSC Financial Advisers

In a world where success is measured by income many people are always looking to the next milestone. Whether that be the bigger house, more expensive car, luxury holiday or promotion – as salary increases, often spending increases too.

This is something I see all too often in my role as a financial planner. Clients are sometimes so focused on living the dream lifestyle that goes with a good job, and ticking all the boxes that demonstrate their success, that they forget to look to the future. What happens when the money stops coming, either though illness, retirement or even death? How will this affluent lifestyle be maintained for you and your loved ones?

These are all things that people don’t like to think about, and prefer to shy away from, as they are a reminder of the fragility of life. But for anyone who has grown accustomed to their lifestyle and the luxuries that come with it, either large or small, thinking ‘what if the worst were to happen’ is essential if they are to ensure they are protected.

So what protection is out there?

There are countless insurance products available for those who wish to cover themselves, but a few products that I feel everyone should consider are income protection cover, critical illness cover and life insurance.

Income protection is a basic insurance that anyone with a salary should look into. What if you couldn’t work? How would you pay the bills, the mortgage, the finance loan on the car? With Statutory Sick Pay at only £96.35 a week, many people would quickly have to use their savings or fall in to debt if they were unable to work.

Of course, some people may work for supportive companies who offer full sick pay for their employees but this can sometimes be capped and is not always a long-term option to fall back on.

Income protection insurance is a long-term insurance policy that provides a monthly payment if you can’t work because you’re ill or injured, and typically pays out until you can start working again, or until you retire, die or the end of the policy term – whichever is sooner.

With income protection it can replace part of your income if you become ill or disabled. To minimise payments, 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. The majority of policies cover most illnesses that leave you unable to work either in the short or long term and will allow you to claim as many times as you need while the policy is active.

Critical illness cover is slightly different and will enable you to continue your lifestyle in the event of being diagnosed with a critical illness. In this event you may not be able to return to work straight away, or indeed ever, and you may even need modifications to your home or therapeutic care which can all be covered by the policy.

Critical illness cover can be taken out on its own or as part of a life insurance policy and is designed to pay out a tax-free lump sum on diagnosis of certain life-threatening conditions.

Some policies will include a more comprehensive cover including loss of sight or hearing, a permanent disability or in some cases a loss of a limb. However not all policies cover everything so advice from a financial planner is always advised.

Very few policies will pay out critical illness insurance straight away, and will have a survival period built in, so only after this time has elapsed will they pay out. The good news is that medical advances mean more people than ever are surviving conditions that might have killed earlier generations. Critical illness cover can provide cash to allow you to pursue a less stressful lifestyle while you recover from illness.

Life cover is, in my opinion, a must for anyone with a mortgage and a family. It is the responsible thing to do to ensure your loved ones are protected, should the worst happen.

Dealing with the death of a loved one is difficult enough to navigate even without the additional stress of financial hardship. Life Insurance policies are there for peace of mind and protection of assets such as houses and cars.

Whichever combination of insurances you decide on, make sure you seek advice from a professional first. 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.

Remember, plan for tomorrow and live for today. After working hard for the career, lifestyle and all that goes with it, don’t let it be taken away by something out of your control that life throws at you. Get protected for your peace of mind and for your loved ones.

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.

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