June is Family Finance Month on our frugal planner…
We are finishing off our look at insurances, and as I start writing the next batch of ideas about how to balance the books at home (cleaning – ugh), I was saddened to learn of a family at our school that have a poorly little one, I gave our best wishes etc – and it struck me that our little family is in no way financially covered for needing to be off work if the kids have a long term illness or hospital stay… Critical illness cover usually means that if the person earning is too ill to work a payment will be made – but what if the person earning is ok, but needs to stay in hospital with their child?
I’ve been speaking to the lovely, helpful and well-informed Louise at AJProtect about what parents may need to think about when discussing the insurance needs of the whole family. It was an eye-opening conversation!
- Families need to have some Life Insurance so that if one parent dies, there is enough money for the surviving person to care for the children, pay the bills and keep the house running. This means that even non-earning parents need cover – as without them so many tasks would have to be paid for!
- Critical Illness cover CAN include your children up to age 17. Any payout will depend on what’s wrong – but the main ‘core’ illnesses are usually covered. For example, in the Vitality Life plan, a payout of between £5000-£25000 would be included.
- There is also something called Income Protection, when you are signed off from work you can claim 60% of your gross pay as a monthly income until you are fit to return to work. As the illness of a child means you may well be signed off with stress – this cover is also worth considering for parents. It would also be an important one to consider should a parent become ill as the bills still need to be paid…
Looking carefully at your family finances isn’t always a very comfortable conversation – but is certainly one of the most important ones you can have as a family. We have tried to share our experiences and research in the Finances section – we haven’t completed all the work ourselves yet, and working out how to much we can pay for monthly insurances is our next task. When you are responsible for children it suddenly seems so much more important to have a backup plan.
I’ve been talking to Louise as I’ve found her to be on my wave-length, it’s a good option to discuss things with a professional when you’re ready. You can find someone via your bank or building society, via your employer or look online. If you are in the UK and want to talk to Louise you can contact her at AJ Protect 01473 35 15 85 or tweet her @ajprotectltd.