Forgive me, if I indulge myself for a few moments. Last month my dear old Mum passed away. She lived to see her 100th birthday and other than working in my Grandfather’s Post Office, and being an auxiliary nurse during the 2nd World War, she devoted her working life to her family. It must have been difficult bringing up three boys, born between the end of the war and the late 50’s, together with looking after both her parents, who lived with us in a big Victorian house. Dad worked all the hours to pay the bills, and Mum did everything else. When she ‘retired’ as we could all look after ourselves, she spent 27 years volunteering at a day centre for the elderly even though she was, latterly, older than some of the attendees! After Dad died and the ‘jobsworths’ at the Council discovered that Mum was nearly 90 and stopped her from volunteering, the light seemed to go out of her life. Despite her abiding love for her children, grandchildren, and great-grandchildren she felt that she lacked a purpose in life, and slowly illness and old age overtook her.
This story, combined with an article I saw recently in a trade magazine, made me think of the value of ‘non-working’ Mums: not just emotional and physical, but also monetary. A primary consideration in financial planning has always been the protection against the loss of income by the breadwinner. Where there are two working parents, protecting both their incomes is usually second nature, but some 70% of women are primarily responsible for the caring of children and the loss of their income, where applicable, and having to pay for childcare in the event of their death or long-term disability, is often ignored, or de-prioritised.
A recent study showed that only about 39% of mums are covered by a life assurance policy and only 9% are covered by critical illness insurance. Approximately 50% of those asked said they couldn’t afford cover and financial constraints are obviously of great importance, but with a little judicious budgeting a young family should be able to afford a reasonable level of cover. Interestingly, 13% thought it was a complete waste of money. The loss of the home-maker clearly has a huge impact and the financial implications are much greater than many people consider. However, a well planned suite of protection products can be affordable, especially if the individuals are reasonably young. It is well worth remembering that as soon as a couple have family responsibilities providing some sort of cover is of paramount importance. Firstly, because our priorities change immeasurably once we have children, but importantly because the younger we are, the cheaper that protection cover is. Markedly cheaper. If you choose guaranteed premium products their premiums will never increase and, as a result, become relatively more affordable as the family income increases.
In my 30+ years in the business, I have seen too many tragic cases of families losing a parent and suffering the consequences. Whilst this will never be less than horrible, I have also seen the beneficial effects of family protection providing the means for families to concentrate on caring for each other without having to worry about how to pay the bills.
Enough for this issue. Have a mellow autumn, look after yourselves and your loved ones, and I’ll be back in the festive issue. Oh, and thank you and rest in peace Mum.
Categories: Money Matters