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Planning for the unexpected

What would happen to your family finances should long term illness happen?

Hand of doctor reassuring her female patient

Alex Price

in Features


The possibility of getting a serious illness isn’t something we like to think about however, the current pandemic has brought it to the forefront of our minds. Should you have to take time out of work due to illness, the last thing you want to worry about is money. Being prepared can alleviate some of this stress.

My top tips are:

Build up an emergency fund

Saving an emergency fund to be used in times of difficulty is very useful, and the recommended amount is usually 3 to 6 months income if possible.  Keep it in an accessible savings account so you can draw on it when needed.

Check your employment benefits

Read up on your companies’ sick pay policy. Most employees are entitled to Statutory Sick Pay however, this is unlikely to be enough to pay your bills as the weekly rate for the 2020/21 tax year is £95.85 a week.  Some companies will provide full pay for a fixed period, for example, 6 months, and then a lower amount for a further period. 

Work out your monthly expenditure

It’s a good idea to work out what you and your family need on a monthly basis should you be unable to work.  Having a good idea of your budget for essential living can make it easier to cut costs in other areas.

Contact your mortgage provider to see if you can take a mortgage holiday

Many mortgage lenders have allowed mortgage borrowers repayment holidays to help ease the financial pressure caused by COVID-19. They may have some flexibility to do so for cases of longer erm illness too, though missed payments are usually added to the outstanding amount.

Check if you are entitled to any help

You may be able to claim state benefits if you are off work for a period of time.  Citizens Advice is a great place to get information on what benefits you may be entitled to.

Look after your mental health

Having to take time off work due to an illness and struggling with your finances can have an impact on your mental health.  Make sure you seek help from your GP or a local support group.

There are also a variety of protection plans you can put in place to help you should illness strike and prevent you from earning a living. This is particularly relevant for many self-employed people who are not entitled to benefits through employment. A Financial Planner can advise you on the most appropriate plan for you and your family.

Income Protection Plans - These provide a regular income when you are off work sick. The cover will start when you are unable to work for a specified period of time chosen at policy outset e.g. 6 months. This is especially useful if you are self-employed. 

Critical Illness Plans - Provides a lump sum at a chosen level if you are diagnosed with a critical illness such as cancer or a heart attack.  Each company will provide a list of critical illnesses covered by their plan.

Private Medical Insurance – This cover pays for your medical bills if you choose to get treated privately.  This option usually means you get access to treatment more quickly.


Why speak to a financial planner

A Charles Stanley expert planner will get to know your financial and family circumstances and help you plan for unexpected setbacks.  We will check for potential shortfalls should you become ill or incapacitated. Using cash flow planning technology, we will stress test your current situation to show you the impact on your lifestyle should you become ill.  We will develop a personalised plan to make sure you and your family are protected.

Speak to Alex

If you would like to speak with Alex to understand your current situation and the options available to you, arrange a free of charge consultation with no obligation.

0289 099 4576


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