3 ways that financial protection can support your mental wellbeing July 16, 2021 by Michelle Boakes Category: News&Protection If you’ve been struggling with your mental health in recent months, you aren’t alone. According to figures from the Office for National Statistics (ONS), more than one-fifth of Brits experienced some form of depression in early 2021. The isolation and stress of the pandemic has affected many people and, if you’re one of them, it’s important to take steps to limit its impact. This is where financial protection can help you. Not only does protection look after your financial wellbeing, but it can also support your mental health too. Read on to find out three of the ways that it can help you. 1. Protection can reduce anxieties over a potential loss of income One of the biggest impacts of the pandemic has been that many people now suffer from heightened anxiety regarding their finances. According to a study published in the BBC, around 8.6 million Brits had seen their income fall since the initial outbreak in 2020. The pandemic has been an incredibly stressful time and further concerns over money are the last things you need. Losing your income can have a serious impact on your mental health, as the worry of not being able to meet your financial obligations can be a significant source of stress. This is where income protection can help as, if you ever needed to take time off work due to falling ill or suffering an injury, it can allow you to keep paying your outgoings until you’ve recovered. Income protection pays you a monthly sum after an “excess period”, which is the time you must be off work before it kicks in. Typically, the longer this period is, the less you’ll have to pay for your premiums. You may want to choose an excess period that aligns with the sick pay that you receive from your employer. For example, if your workplace will pay you two months of salary if you were unable to work, you may want your protection to begin after that. One important thing to bear in mind is that many plans do not cover every illness and may not cover any pre-existing conditions. That’s why it’s essential to thoroughly check the terms of your cover. Losing your income can be incredibly stressful, particularly if you’re the main or only earner in your household. Protecting yourself against this possibility can help to give you more peace of mind and support your mental health. 2. Having cover can reduce the financial stress caused by serious illness As we have seen over the last year, being diagnosed with a serious illness can be a stressful and emotional time. If it were to happen, not only might it affect your lifestyle, but it could also impact your finances, too, if you were unable to work. This is where critical illness cover can help. If you get diagnosed with, or need treatment for, one of a list of serious illnesses, this form of protection will pay you a cash lump sum. Illnesses covered typically include some forms of cancer, heart attack, stroke, and multiple sclerosis. You can then use this to repay your mortgage or other debts, modify your home if you have a disability, or maintain your current living standards if you are unable to work. However, the illnesses covered by this protection tend to vary between insurers, so you may want to check the terms of the cover, so you know what you’re protected against. Having protection in place that covers the possibility of serious illness can be a huge weight off your mind. With it, you can rest easy knowing that even if it were to strike, your finances wouldn’t be impacted. 3. It can mean your loved ones won’t struggle financially if the worst were to happen Most people don’t like to consider the possibility of passing away, but one of the lessons that the pandemic has taught us is that the unexpected can happen at any time. If you have people who depend on you financially, you can imagine the impact that your passing might have on them. This is obviously a very serious concern, as they might have to experience a lower standard of living than they are used to. If you have children, financial troubles might limit the opportunities available to them once they grow up. This is where life insurance can help you. There are several different types of this, but some of the most popular are: Level term assurance This type of cover will pay your loved ones a lump sum if you pass away during the policy term. You may want to match the term with the end of your mortgage payments, so you don’t need to worry about your partner being unable to make repayments if you pass away. Decreasing term assurance With this cover, the sum that your family would receive decreases over time, which can be useful if you have a repayment mortgage. Since the payout decreases, it is often cheaper than level term assurance. Whole of life cover This type of protection can give you more peace of mind as it is guaranteed to pay out on your death, whenever it occurs. Due to this, it is often more expensive than other forms of cover. However, it’s worth bearing in mind that term assurance policies typically have no value in cash at any time and your cover may lapse if you do not keep up with your premiums. Having this protection in place can be a huge weight off your mind. You can be sure that your loved ones would be looked after financially even if the worst were to happen. Get in touch If you want to gain more peace of mind by protecting yourself against the unexpected, get in touch. Email us at firstname.lastname@example.org or call 0330 320 5048.