We asked that old romantic, Brendan Hoy from WB Financial, to tell us what love really means…
Protecting your loved ones
Protecting each other from harm is at the core of all of our relationships. We do this by providing shelter and support, we combine income and expenses and try our best to pay our mortgages and build wealth together whilst raising families.
These days, most people insure their assets against something happening that could have huge financial consequences. We insure our homes, cars and even our pets and it is sensible to do so.
And yet the largest asset that people own is one of the least insured – your ability to earn an income. Let’s look at why our ability to earn an income is our largest asset. If we consider the average Australian income to be around $75,000 per annum and are looking at someone aged 40 with approximately 25 years of work still ahead of them – this brings their ‘asset’ to the value of over $1.5 million.
What if something happened to you, impacting your ability to earn an income? How would this impact your partner and your family? Would you need to sell assets such as the family home because mortgage repayments can no longer be made? Would you need to move out of the region? Would you be dependent on others to survive financially? These are very significant questions.
It’s certainly not ‘love’ to leave yourself or your loved ones financially exposed in the hope that you’ll never have an accident or become too ill to work. None of us would risk our homes or vehicles but unfortunately, many people are facing this unnecessary risk every day with only 31% of us holding income protection insurance. Did you know that 20% of all mortgage defaults are due to illness or accident in the home?
I can appreciate that your next thought is probably, ‘more bloody insurances. I just can’t afford it’ and I understand this frustration. However, there are now ways of funding your cover through super or a combination or super and cash flow so affordability should not be an excuse. The real question is, can you afford not to be covered against sickness and accident?
Part of my job is to find a way for people to protect their families. Protecting those you love most – that to me is the definition of true love.
To discuss this further, please give me a ‘hoy’ anytime.
Principal Financial Adviser