19 August 2015

Tips for Young adults ~ Protecting your lifestyle

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• Are you employed or self-employed?
• Do you have debts or financial commitments?
• How long would your savings last if you couldn’t work?

What is income protection?

Your twenties are a decade to celebrate and enjoy. It’s a great lifestyle full of friends, freedom and maybe even some time overseas if you’re lucky.

It’s also an expensive lifestyle. And to keep up with all of your bills and living costs, you need to continue working as hard as you are today – something that may not be possibe if you suffer a serious illness or accident.

Income protection is a way of protecting your lifestyle against sickness or injury. It pays a monthly income of up to 75% of your regular salary until you can return to work.

What this means for you

If something does happen that stops you from working, receiving an income protection benefit means you’ve still got money coming in to help you pay bills and other expenses.

For example, your insurance money can help you cover regular costs that have to be paid like:

* Rent
* Car or personal loan payments
* Credit card bills
* Phone, internet and mobile bills

Having this financial support can also help you afford the treatment you prefer, and take the time off work you need to recuperate properly.

Income protection costs a fraction of your income (typically around 2%) and is tax-deductible in most cases – making it an extremely cost-effective form of insurance.

However, different policies will often have different features and benefits, so it’s worth talking to a financial adviser to find out what type of policy best suits your circumstances and budget.

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What are the chances?

• Between the ages of 25 & 45, your life expectancy is only 46% if you are a male and 50% if you are a female. ¹
• More than 15% will be disabled for more than 3 months during their working life. ²

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Contact Verante Financial Planning for further information on (02) 9894 1844

¹ http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/3302.02012?OpenDocument
² Source: Australian Disability Table IAD89-93 – Institute of Actuaries

The author is an employee of Verante Financial Planning in Castle Hill, Corporate Authorised Representative of Magnitude Group Limited, Licence No 221557, Magnitude Group Limited ABN 54 086 266 202.

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