A health crisis can occur at any time of life, but the risks obviously increase as we age. Unfortunately, due to this increased risk of illness or injury the cost of insurance for those over 50 can be high. As a result, people in this age group are tempted to drop their insurance cover altogether just when the need is at its greatest.
If age 50 is on the horizon, or recently passed by, it’s even more important to continue to protect both your income-earning ability and the financial security of any dependants. Here are four solutions to consider:
Level of insurance
Review your level of insurance. As your investments and superannuation increase, you may be able to reduce your cover and still provide for your beneficiaries.
Life and Disability insurance through Super
Life and disability insurance can be arranged through most superannuation funds. Premiums can be lower and are paid from the superannuation balance thereby reducing strain on the household budget.
Annual or sick leave
If you have accrued a lot of annual or sick leave, you might want to increase the waiting period on your income protection insurance which can reduce your premiums. Depending on your circumstance, this may allow you to retain an important benefit at a more affordable price.
Pay in advance
Prepaying 12 months’ worth of income protection policy premiums before 30 June may allow you to bring forward a tax deduction for next year into the current year. This can potentially reduce your taxable income and the tax you pay this financial year.
Everyone is different so there might be other solutions not mentioned here. If you’re not sure what to do, speak to one of our licensed financial advisers before you make any adjustments to your insurance cover. We can help you achieve the right balance for your needs at any age. Click here to book an appointment with us.
