We are all probably aware of high-profile cases where following an accident or serious illness, seemingly wealthy people have struggled to cope financially.
It could be that financial resilience has never been something they have needed to think about or seem necessary for them to consider.
However, many UK adults who are deemed as well off still depend on an income or possibly two to maintain their current lifestyle.
And if things change, much of their wealth could be tied up in property, businesses or longer-term investments which could be impossible or costly to draw from in the short-term.
Hypothetical case study
Probably the best way to appreciate the financial burden families go through is to look at a case study:
Jayne and Mark are in their early 40s, they have two small children aged seven and five with both children educated privately.
Jayne is a self-employed physiotherapist and Mark is an employed architect.
Sadly, Mark has been diagnosed with terminal cancer and after several months of treatment to prolong his life, he is now at home. He received six months full pay from his employer but that has now come to an end.
They are finding they are experiencing higher living costs and additional expenses because of Mark’s illness and are struggling to meet their monthly commitments and maintain their lifestyle.
Another factor to consider is that Jayne is self-employed so the time she needs to take off caring for Mark means she has no income at all.
While the couple have an expensive house, run two prestige cars and educate their children privately, their lifestyle very much depends on both their incomes.
They have a lot of equity in their property, but the last thing Mark, Jayne or the children need is the upheaval of moving to a smaller property while coping with Mark’s deteriorating health.
Serious illness is costly, from travel to medical appointments to paying for carers and as Mark’s condition deteriorated, the family needed the support of a carer.
They began by paying £20 an hour but they were expecting Mark would eventually need round the clock nursing care which costs around £600 a week at home or, if Mark went into a nursing home facility, nearer £800 per week.
The case for protection
A number of protection policies could have helped Mark and Jayne.
Potentially a bespoke menu plan, including critical illness, income protection, perhaps some family income benefit that could provide either a lump sum or additional monthly income to cover these extra costs.
In addition, added value support services can prove invaluable, not only to the person who is ill, but also their immediate family.
Features such as a second medical opinion, with expert medical professionals to talk to about the condition and treatment plan, alongside other therapies, can prove invaluable to someone coming to terms coping with an illness or injury.
Other family members may also benefit from counselling, support with childcare and even respite support as they take on the role of carer.
For children, teenagers or young adults, coping with the serious illness of a parent, is often at a turbulent time in their lives, so counselling and mental health aid can give real.
So, for wealthier clients, it’s best not to assume a life shock such as an accident or illness where an income is either immediately or imminently lost or much reduced, will not have a huge impact on that family.
Protection can ease the financial strain that an accident or injury can bring.
A lump sum or replacement income coupled with a wide range of support services could make all the difference in coping.
