Judging by what I see every day as a financial adviser, the silent enemy in family money management is FINANCIAL STRESS.
Financial stress causes arguments, breaks up marriages, and has the capacity to make a serious illness a whole lot worse. The irony is that it is not caused by lack of money but by the poor planning and management of money.
If you want to give yourself a chance to recover from a serious illness such as cancer or serious heart condition, then it helps to stay calm and relaxed and let your body do what it does best.
Financial stress will never help and actively works against your recovery.
If I suggest that you consider Trauma Insurance to relieve financial stress at a time of serious health crisis, you will probably stop reading. So I won’t.
Instead, I will give you a recent example of what can happen when you don’t.
A single middle aged lady was referred to me mid last year. She asked for help with household budgeting as her credit card debt, on top of her mortgage payment, was getting out of control.
As you can imagine, she was stressed over her financial situation. I could see it in her eyes.
Together we worked out a solution that was realistic and achievable and, at the same time I recommended that she insure herself because, as I explained, it was a really bad time to be financially caught out by a serious illness or even a car accident injury.
So I recommended Trauma Insurance as a priority; enough to cover her debts and allow her a stress free recovery period in the event of a serious illness diagnosis; and also income protection in the event that ill health prevented her from working. In addition, I proposed life insurance, enough to eliminate her debts if she should die.
Even at lower amounts, she said she couldn’t afford any of it, not even the Trauma Insurance; even though the premium could and should have become an essential budget item. She chose to defer it until she was in a better financial position.
She returned to see me recently, only a few months later. She was going well with her budgeting and heading in the right direction with her personal debt problem.
She had also just received a diagnosis of stage 3 breast cancer.
With a need for immediate surgery, she has no money to fall back on and no family support. The bills won’t let up so she doesn’t have any financial breathing space. Without that, she doesn’t have the stress-free time she now needs to recover. To make matters worse, she is now uncertain about how long her employer will keep her on.
Her stress has just multiplied.
This is general advice only. The purpose of this article is to provide you with practical examples as a means of education in the poorly understood area of personal risk insurance. As a licenced financial advisor, I strongly urge you to seek personal advice about protection which would be tailored to your individual needs and circumstances.