Mortgage & Income protection: Are you prepared for a rainy day?
When it rains you appreciate a roof over your head. But if that rainy day comes in the form of an illness or injury that stops you from working, and you don’t have substantial savings or income protection, you may be putting that roof in jeopardy.
For many people facing regular household bills, worrying about the future isn’t a priority, but they could be living on borrowed time.
There’s always another bill to be paid
According to the Office for National Statistics*, the average British household spent just under £530 a week in the year 2015-16.
Of that, cars and public transport accounted for £72, housing bills and utilities another £72, food and drink, around £56, £23 goes on clothes and shoes and £16 on our phones. For a little relief we spent £68 on recreation and £11 on alcohol and tobacco.
The rest is spent on a variety of expenses, mortgage repayments, rent, goods and services reflecting our diverse lives.
That doesn’t leave much left for saving and it’s hardly surprising that people don’t find the money for monthly income protection products and even less for thinking ahead with income protection.
Mortgage & Income protection options
You have a number of options for protecting your home and family, the most common being:
- Life Insurance. Also known as term insurance or life assurance, this provides a tax free sum of money in the event of death during the term of the policy. Your dependents can use life insurance however they choose but it can be used to cover a mortgage or to protect your family by repaying other loans.
- Critical Illness Cover. A critical illness plan pays out a lump sum on the diagnosis of certain specified illnesses. The money can be used to repay a loan, mortgage, or cover monthly bills during time off work.
- Income Protection. An income protection plan is designed to pay out a regular income if you become unable to work due to an accident or illness. These types of plans continue to pay out an income as long as you are unable to return to work until the end date of the policy, typically your normal retirement age.
- Family Income Benefit. Family income benefit is a life insurance policy set for a period of time, known as the term. If you die within this period, the policy will pay out a regular tax free income until the end of the term. For example, if you have a 20 year policy and die after five years, the policy will pay out the remaining 15 years.
Enjoy peace of mind
If you’ve been diagnosed with a serious illness or have an accident, you might wait several months for treatment and then spend months recovering. Instead of worrying about your savings being used up or your home being repossessed, you can enjoy the peace of mind that comes from knowing that mortgage repayments and household bills are covered so that you can focus on family, recovery and rehabilitation.
At Clayton-Welch Associates we specialise in offering professional, impartial support to people who need a specific type of mortgage or who have experienced difficulties with mainstream mortgage lenders in the past.
We also advise on the most appropriate mortgage & income protection policies. Premiums depend upon age, health, income and the level of cover you need, but the cost can be reduced if you shop around for a policy with the help of one of our advisors.
We work with a comprehensive range of providers from across the market to help clients find the right mortgage and income protection for their specific circumstances and needs.
Your property may be repossessed if you do not keep up repayments on your mortgage.
We rely on referrals for our business, so customer service is the foundation of everything we do. We are passionate about finding you the mortgage you want and we accompany you through every step of the way to a successful application.
Find out how we can help you to maintain your mortgage repayments through income protection by contacting Clayton-Welch Associates today.