With the children heading back to school, we recommend taking the opportunity to firstly, rest (!) and, secondly, to review your life insurance.
Life insurance can feel like a one time purchase, but the reality is that it’s wise to regularly review the policies you took out. We recommend every couple years with our clients because, inevitably, your life circumstances will have changed within these periods and, with that, the amount of cover that you now need.
As an example, when you first took out life insurance and critical illness cover, you may have just started contracting, been newly married and renting. Because of that, you cover simply needed to provide enough to support you and your other half’s general living costs in the instance that you became critically ill or, sadly, passed away. Now, you may be in your early forties, have a mortgage and two children who are at school.
It’s life circumstance changes like this that mean it’s wise to review whether the policies your originally took out are still fit for purpose.
A report by charity ‘Child Poverty Action Group’ in 2017, detailed the cost of raising a child to age 18 in 2017, for basic family incomes, to be £155,142 (if you are in a couple). With most contractors having an income that is significantly more than a basic family income, these costs are likely to be a lot higher.
With that in mind, if your circumstances have changed and you now have children, more children, or a lifestyle that has significantly shifted due to a higher income than when you first started out as a contractor, it is worth reviewing your life insurance and critical illness cover.
Take a moment, now the children are back at school and establish if the payout you or your family would be in line for would cover the new costs there are to raising children. If not, book yourself in for a review with one of our expert advisors and we’ll be happy to help.