Securing your financial safety

Many of us have important life goals we would like to achieve. Whether it’s improving health and fitness, travelling around the world or achieving career success, everyone is driven by something.

You might even be taking steps to make your goal a reality sooner rather than later. Making a plan to achieve your dreams is a good thing, but what people don’t often prepare for is the possibility of being unable to earn an income.

Wages and salaries are essential for achieving many of our most cherished goals, yet lots of Australians don’t take the necessary steps to protect this vital flow of income for the future.

Financial security will mean different things to different people, but it’s essential for living a comfortable lifestyle – not just for you but for your family and other dependents as well.

Achieving financial security

If the thought of managing your finances leaves you in despair, don’t give up just yet. There are actually plenty of ways you can focus on securing your finances and building a fund to fall back on in times of emergency.
Lots of people take out insurance to protect their physical assets such as a house or car, yet many don’t realise they’re leaving one of their most important assets unprotected – their income.

Income protection insurance is one way of insuring this crucial asset, for the benefit of yourself and your loved ones. An unexpected accident or illness could see you being unable to work for an extended period of time, and this can be a strain on your finances.

Financial worries can also add an extra burden and even more stress on you and your family, at a time when you’re trying to recover and get back onto your feet.

With such potential for disaster, you might think that more people would take steps to protect themselves against such an emergency, but this isn’t the case.

Statistics show that one in three people are likely to be disabled for a time before their retirement, but less than 30 per cent will have the necessary insurance arranged to protect themselves against such a possibility.1
Income protection insurance can provide you with a monthly benefit to support you and your loved ones, for insurance policies available directly through Choosi, this could be up to 75 per cent of your pre-tax income (up to $10,000 per month). When you apply for your policy you will need to choose a waiting period, generally 30 or 90 days and also the time that you would like to receive your benefit which can be up to 5 years. As an option, you can also arrange for rehabilitation benefits to be included in your policy so you can transition back into the workplace more easily.

There are other income protection policies available that offer a larger benefit amounts, and longer benefit and waiting period, some of which are available through Choosi’s adviser partner.

As there are lots of different policies available, you may find it helpful to compare income insurance policies with Choosi to find the right product for you and your circumstances.

Alongside income insurance, careful budgeting, planning and saving can also help to secure your financial safety. Tracking your expenses can help you identify areas where you could cut back for greater savings, and creating a realistic budget will help ensure you avoid a potential blowout.

  1. Income protection [PDF, 1 page, 190 kB], Deloitte

These articles are provided as reference material to allow more informed decision making, but are not intended as being a complete source of information on any topic. All readers should make their own independent analysis on the topic to make sure they have considered the aspects that are important to them.