Newsletter

FLOWERS ARE GREAT BUT HOW DO YOU SHOW YOUR LOVED ONES YOU REALLY CARE?


Flowers and chocolates for Valentines are great but how can you really show you care long after the petals have dropped and the chocs have been scoffed?

Not very romantic we agree but our guide to family protection could be worth a lot more than a dozen red roses particularly if the worst happens.


HAVE YOU PROTECTED YOUR MORTGAGE PAMENTS?

If not you could be in for a shock if you're out of work for any extended period due to accident/sickness or unemployment. The days when you could claim social security payments to cover your mortgage payments are long gone and these days the rules are much tighter. Under current benefit rules you are ineligible for assistance if;

• You or your partner have savings of more than £8000 and/or;
• Your partner works for more than 24 hours per week

Even if you are eligible to claim, if you took out your mortgage after 1995 you will get no state help for the first 9 months - so ask yourself - could you afford to make 9 months mortgage payments without your salary coming in. If the answer is no you should really consider taking out some form of cover to protect yourself.

This cover is not as expensive as you may think and if you shop around you can arrange it much more cheaply than through your lender. For example a policy through British Insurance could cost as little as £2.45 for every hundred pounds of monthly payment so if your monthly mortgage payment are £400 cover could cost as little as £9.80 per month for unemployment cover only or £15.80 per month to cover unemployment and disability.

Mortgage Payment Protection

HAVE YOU PROTECTED YOUR INCOME?

How would you fare if you were unable to work due to incapacity or unemployment? For how long would your employer pay you if you were off work for an extended period due to an accident or sickness and how long would your savings last before you had to seriously cut back?

The answer could be an Income Protection Plan which would provide an income in the event that you were unable to work. There are basically two types of plan available. The first is called Income Protection and would pay you for a fixed period of time if you were unable to work due to incapacity or unemployment. These policies will usually provide cover for a fixed period of time i.e. up to 12 months or until you return to work and are designed to provide a solution to fairly short term problems. A policy with British Insurance, for example, will cost as little as £3 per month per £100 of benefit for Incapacity alone or £5 per month per £100 of cover for incapacity and unemployment.

The second type of plan is commonly called Permanent Health Insurance and is designed to provide an income in the event that you are unable to work due to long term sickness or disability. These policies will generally pay out for as long as the incapacity lasts, for a set number of years or until normal retirement age depending on how the policy is set up. For this type of cover it is sensible to take Independent Financial Advice to make sure that you get the most suitable cover, at the best price, for your circumstances.

Income Protection

HAVE YOU PROTECTED YOUR LIFE?

Do you and your partner have your lives insured. If not you could be leaving your loved ones vulnerable if the worst was to happen. And it's sensible to have cover over and above just the mortgage. Life insurance can be purchased quite cheaply for most people particularly if you buy it when you are relatively young and a financial adviser can help you decide on the right level of cover for you, taking into account any cover you already have, cover provided by your employer as well as your available budget and the financial requirements of your dependents.

An alternative to simple life cover which pays out a lump sum on death is a less well known product called Family Income Benefit which pays out a monthly or annual benefit for a pre-determined period of time. This means that rather than your dependents being presented with a lump sum they get a regular income for as long as it is needed. Again a Financial Adviser can help you decide if this product is suitable for you.

Life Insurance Quote

PENSIONS - ARE YOU DOING WHAT YOU CAN?

Pensions can be a bit of a thorny issue these days but unless you are making some form of provision you could be in for an extended working life or a pretty miserable retirement.

Also, did you know that you can now arrange a pension on behalf of your spouse even if they are not working. This is a pretty tax efficient way of saving as you will get tax relief on the premiums which effectively means that the tax man is helping out as well.

It's even possible to start a pension for children and this can prove a very efficient way to save on their behalf. Parents or grandparents can contribute meaning that you are helping your young ones build a pension fund even before they have started earning - a fantastic way to provide really long term help.

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