Reeves Blogs

Be Prepared and Take Control

Can you remember this time last year, when it was just dawning on an unsuspecting world just how serious the Covid pandemic was going to be?

Now, it looks like our lives are not going to be the same again – at least not for some considerable time.

But, that’s often the way with serious illness: it can strike seemingly from nowhere and turn our lives upside down.

That’s why, in the second quarter of this year, we’re going to concentrate on the importance of our clients being prepared for serious illness and the effect it could have on them and their families. This is not being morbid, it’s just following our philosophy of putting you – the client – in charge, helping you to minimise the negative impact of events beyond your control.

To achieve that, we’re going to look at the steps you can take so that you and your family are prepared for the worst.

As always, no two people’s circumstances are exactly the same and we tailor our advice to the individual. The annual review is a good opportunity for clients to discuss their own situation with their client advisor, but, of course, they can pick up the telephone at any time and we will be ready to provide advice, guidance and solutions. Here, we just set out some general considerations for people on each stage of the savings journey.


ESSENTIAL & GROWTH LIFE STAGE


For younger clients, under the age of 55, in what we term the Essential and Growth category, the emphasis is still on paying mortgages and raising children, while also still building up a pension pot. Death at this stage is more unlikely but its impact on surviving partners and families can be devastating. Serious ill-health can also seriously impact current living standards, as well as future retirement plans.


Solutions we might look at could include income protection, or - where there is one major breadwinner and a dependency on the pension fund of one person - whole-of-life plans. We could also consider: life cover, FIP, term assurance, or mortgage protection insurance.


PRE RETIREMENT LIFE STAGE


For those in the pre-retirement stage, in the years leading up to giving up work, they should be considering what would happen if they were seriously ill and had to stop working earlier than planned. How could that change the retirement plan for them and their partner? The reliance of one partner on another for retirement income could be more significant. Do they need a whole-of-life plan? Many people at this stage still have commitments. They might have had children later in life or taken on bigger mortgages but not have upgraded their life cover. Death or illness have to be considered.


RETIREMENT LIFE STAGE


Finally, for those who have retired and are older, they should satisfy themselves that everything is in place to protect their family and loved ones if they die. Here we would consider inheritance tax planning and trusts. Clients in this category also need to think about the effect on finances if they or a partner become so ill they have to go into a care home. Is it time, or will there be a time, when it’s necessary to consider downsizing the house?


These issues are relevant to all our clients and everybody should consider them carefully. It’s likely that you will also know other people – friends or relatives – who haven’t given the thought to these eventualities that they should. If you believe that they could benefit from talking to a Reeves advisor, remember that you can put us in touch using the Reeves Advocate Referral Scheme which we outlined in last month’s Insight and earn yourself a £100 Amazon voucher and the chance to win a luxury holiday worth up to £5,000.

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