LONDON – LIVING – Income is defined as the amount of money you receive on a regular basis particularly for performing a task, such as providing services or selling products.
Income is typically fixed, i.e: you are well aware of the amount of money you’ll make for performing a task and is paid in intervals, i.e: at the end of the month or end of a contract. However, the sad fact is that your income is not always protected.
What does it mean to have unprotected income? It means you may not always earn the money that you expect to earn, and may lose some or all of it due to one reason or another. This is why there is a need to protect your income.
While we find it necessary to have health and vehicle insurances, we tend to neglect income insurance. This is a huge mistake that can cost you a lot in the long-run.
There are several benefits to protecting your money which is why you should know the ways in which you can protect your income.
So, what steps can you take to protect your income?
Here is the information that you need:
What Can Cause me To Lose Income?
The most common reason for one to lose income is due to missing work. This can be due to several reasons, with sickness being the most common issue.
We all fall sick, but sadly we do not get enough sick days. According to reports, we get seven to eight sick days on an average after completing one year of service. You may be getting more sick days based on the industry you work in, but the average seems to be pretty low.
However, this is not the only reason why one misses work. You may have to miss work due to a personal reason, such as a court proceeding or your children being sick.
Your employer does not consider all this and would deduct your pay for missing work. This is why you need income protection to guard you against such happenings.
Income Insurance: The Best Way to Protect Your Income
If you unfortunately get injured or become severely sick or due to any reason can’t go to work then having an income insurance will help you out.
It’s a type of insurance that guarantees 60% to 80% of your current salary until you are able to go to work again. The cost of insurance depends on the amount of coverage it provides and also the income that you protect against.
Getting your income insured is very important because mishaps can happen at any time and anywhere, therefore, it is in your best interest to have your income protected by getting income insurance.
What Does Income Protection Cover
Income protection is an insurance and hence it comes with certain limits. Firstly, the amount you save depends on your income or the amount you would’ve earned had you gone to work.
Other than this, the company would make sure that you had a genuine reason to miss work. For example, if you miss work casually, without having a reason, then you may not be entitled to any reimbursement.
Moreover, your income protection company cannot force your employer to pay you in full. Your absenteeism will still impact your yearly report, however, the loss will be covered by the insurance company itself.
It is important that you ask your insurance provider about all the terms and conditions before you sign on the dotted lines so that there are no surprises.
What Else To Do To Protect Income
Other than this, you must take steps to make sure the money you make is not wasted. The best option is to invest it somewhere. These days stocks are risky, so you need to turn to other options.
Some of the most secure investment options include:
- Bonds
- Real Estate
However, all kind of investments come with risks so make sure to do a good amount of research before you pick one.
What If I Do Not Get Insured?
If you fail to get insurance, then you will be in financial trouble. If you do not have enough money, you might have to turn to loans and they can bring you a lot of trouble.
It is in your best interest to get yourself insured. Look for a credible insurance company like iselect Income protection company today and get started.
