Risk Planning
Updated on 3rd February'2014
- Are you aware of pre and post retirement risks?
- Are you insured against Total Permanent Disability?
- Do you have income protection insurance?
- Is your life partner's financial future secure if you pass away before they do?
- Do you have trauma insurance?
Make Sure You & Your Partner Are Covered For Life
There is no telling what may come tomorrow & the unfortunate, but inescapable truth about retirement planning is that you may not live to enjoy your savings; or, you may be incapacitated in some way with medical expenses exceeding your savings.
You need to consider the following four Insurances on your income to ensure an adequate & comfortable lifestyle, should the worst case scenario play out;
- Life Insurance (to protect your life partner & dependants)
- Total Permanent Disability- in case you become disabled in some way & need lifelong palliative care
- Income Protection
- Accident Cover
- Trauma
As part of your financial plan we will work together to find a suitable amount of the insurances listed above against the premiums being paid. I make an assessment of the most cost effective strategy to provide adequate to cover you & your loved ones.
Pre-retirement Risks to manage
These affect your Human Capital, which is your potential to earn & accumulate wealth to fund your retirement;
- Expense risk; The impact of living expenses that may be higher than expected or incurred through misfortune
- Savings risk; Inflation can have a serious impact on retirement savings & is difficult to both predict & manage
- Market risk; The effect of the recent GFC on superannuation savings illustrates market risk perfectly
- Mortality risk; If you’re retirement is planned with your partner the early death of one partner is significant
Your Human Capital depreciates as you age & decreases swiftly once you’ve retired. Although you may have investments geared toward income generation this is far more vulnerable than employment to market risks.
Post-retirement risks to plan for
These are risks to your financial capital, which is the value of your savings & wealth;
- Expense risk; Living expenses, the stability of the consumer price index, unanticipated medical & care expenses
- Market risk; Income & savings assets are vulnerable to market forces. Diversification offers some protection
- Longevity risk; There is always the possibility that you’ll live longer than expected; & unable to afford it
- Bequest risk; Oversights such as an invalid will pose a threat to your dependants & bequest plans
With my advice & assistance we can plan & protect your financial capital against these risk factors & insure your income, your medical costs & your partner.
