Protecting your Main Asset!
Most Valuable Asset??
What is the most important asset you hold? Most people would respond by saying it’s their home, others who don’t own a property might say it’s their car, either one of these could be correct but it’s unlikely.
For the clear majority of us our most important asset is our income or rather our ability to earn a future Income. So, with this, what are we doing to protect it???
Most people have outgoings each month, be it Life Cover, Home Insurance, Car Insurance and all the other outgoings we spend daily. If suddenly we could no longer work, how long could you keep maintaining your Lifestyle, paying bills for? If you are in good employment you may be get paid for 6 months or maybe longer but want happens after this period?????
Currently the State Illness Benefit is €188 per week which might help you if you’re out of work due to illness/sickness, but this is a lot lower than the average wage, so most people would need to top this up to maintain their lifestyle. If you’re like myself and a Company Director or someone who is Self-employed and paying PRSI class S, then you may not qualify for any State Illness Benefit at all.
What can we do??
Just like all of your other assets we mentioned earlier, you can Insure your Income by taking out a policy called Income Protection,this type of cover can provide you with a replacement income if you are unable to work due to an accident, injury or illness and can kick in after 4, 8,13 ,26 or 52 weeks depending on your circumstances in employment and your affordability to pay the premium.Generally income protection policies can replace up to 75% of your income less any state illness benefit or other social welfare entitlements. It works just like any other type of insurance policy, you pay a monthly premium for the cover, the cost of the premium depends on your occupation, health, age etc. EG, A crane driver or carpenter would be higher risk than an office worker.If you are out of work for a prolonged period then your chosen Insurance company provide you with a replacement income until are able to return to work, or until your chosen retirement age.However, unlike many other insurance products, if you make a claim, your policy will continue at no additional cost to you, this means if you need to claim again in the future, your policy will still pay out for a second time.
Added Bonus of Tax Relief?
Income Protection will allow you receive Tax Relief at your marginal rate making your premium more attractive to you.
To finish, Income protection should be part of of any long-term financial plan, after all, every long term financial plan needs an income to fund it and we at Cleere Life & Pensions strongly recommend it.!
If you wish to discuss the benefits of Income Protection and protecting your main asset please feel free to contact us on 056 7721854 or gearoid@cleerelife.ie
Killeen Financial Services Ltd T/A Cleere Life & Pensions is regulated by the Central Bank of Ireland.
