What would happen if you became too ill not only to go to work but to do basic everyday activities like shopping and cooking? What would happen if this wasn’t just for a few days to get over a bad cold but weeks or months? Hopefully this won’t happen, but you need a financial plan in place in case it does.
Peace Of Mind Is Beyond Price
Money can’t buy you health but effective money management can stop poor health from having devastating consequences. In today’s environment there is growing awareness of the importance of managing family finances so that not only do ends meet but that there is also a cash cushion to protect against the impact of redundancy and potential spells of unemployment.
It is, however, important to understand that the impact of critical illness is far more extensive than that of unemployment on its own. Not only do sufferers not have a job, they may realistically have no capacity to take up employment until their health improves. In fact, they may need to employ people to help with everyday tasks or to spend money adapting their home to adjust for their condition.
Stop Illness From Crippling Your Future
It’s dangerous to assume that benefits from an employer or from the state will be sufficient to tide you over a period of illness. If there is a shortfall then it is very easy to start getting into debt (or to be unable to repay existing debts). This can lead to issues such as a poor credit rating or even bankruptcy, either of which can have a brutal impact on your future employment prospects. It is therefor crucial to check exactly what level of cover you already have and to take action promptly if it becomes clear that this cover is likely to be insufficient. As this can be a challenging exercise and could be hugely important to your future, it may be best to get professional advice from a financial adviser.
Critical Illness Can Be Managed
Like many adverse situations, planning ahead can help head off the worst of the damage. The first step is to understand what your potential liability might be, i.e. how much money would you realistically be likely to need in a period of critical illness. This means not only looking at the current cost of your essential outgoings, but at the cost of employing someone to assist with essential tasks. It’s also useful to consider potential wants. For example employing a private nurse might be more palatable than spending extensive time in a hospital, but, of course, this comes at a price.
With this in mind, many people opt for critical illness insurance, which is a type of insurance which pays out in the event that the holder is diagnosed with one of an agreed range of serious illnesses. Unlike other types of insurance, the money may be used at the holder’s discretion rather than for a specific expense such as a mortgage repayment. Some critical illness policies offer additional benefits such as life assurance. As policies vary widely in their details, such as what illnesses they cover and the specific form of the pay out, it’s important to find the right one for your individual situation. Again, financial advisers can offer help with this.