This is a question many people ask themselves when they reach a stage in life where they have responsibilities, such as a mortgage and/or children. Many of us have to tighten our belts and add a steady income to keep up with everything, but what if you can’t work through illness or accident? Would it be wise to protect your income in case you were unable to do your job?
If you work long term, you may want to consider an income protection policy, especially if your job pays reasonably well and you will not have a hard time making mortgage payments as well. A lump sum payment in the event of a death or permanent disability is tax-free. The cost of purchasing this type of policy is about three to five per cent of your current take-home pay. For most policies, you are allowed up to two years of deferral before you must begin paying. Income protection is a good idea for people who have a steady income and want peace of mind that should they become unemployed; they won’t be stuck paying large amounts of money out of their pocket. For advice from Wealth Management Cardiff, visit https://www.harryrobinsonwm.co.uk/
Another good reason to carry an income protection policy is if you own your own business. When you reach retirement age, you will have paid off your mortgage and will have some left over. Many people choose to use income protection when they are self-employed, work long term, or are retired. There are even policies available that can be purchased in combination with life insurance or investment plans for added security.