A plan that is unsinkable unless it hits an iceberg isn't really unsinkable....

Life is precious and precarious. That is two very harsh lessons 2020 has taught many of us.

Having spoken to more families who have made claims on their insurance policies in 2020 than any other year its easy to see that maybe we can't see the woods for the trees.

This isn't another insurance pushing post, so please bear with me as insurance does play a role on the bigger point I'm going to try to make.

As advisers we spend loads of time researching and advising clients on the best strategies for best risk related returns on their pensions and investments. But what if it all goes wrong? What about the fly in the ointment?

Its all very well if we plan and set goals to achieve in retirement, but what if something happens to set us and our family back substantially (like illness), or even permanently (like death) - do the family plans just die as well?

Well the harsh reality for many clients and their families the answer is yes. One thing I can categorically confirm right now is that of all the clients/families I have spoken to during this pandemic who have had to make a claim on their insurance - Not one has said they had to much insurance. Many have expressed that they wish they had more cover - Yet not one has claimed they or the policy holder were over insured.

What is really important to you in a financial plan? It shouldn't just be a best case scenario outcome, the plan should take into account "what ifs"

What if I die prematurely? Will the family survive financially even when the mortgage is paid off? Will the family lifestyle and education plans stay on track if you are no longer here?

Can the same be said in the event of your serious illness?

Can the surviving spouse/partner retire in their own time with a high degree of confidence they will never outlive the investments income (topped up by any insurance payout)

IHT and other tax considerations - Will these be protected in the most efficient tax wrappers to ensure you family will not lose out to inheritance or other associated taxes (40% currently)

Will family capital continue to grow to offset any inflating living costs (30 years in retirement isn't to unrealistic), and will these be left as meaningful legacies to dependents in the time of untimely death? Again will this be done tax efficiently?

In the event of accident resulting in loss of mental capacity (or just natural loss) is there a written agreement in place to allow a third party control of household assets (simply being the spouse or partner is not a legal entitlement to deal with the partners assets in the event of them being unable to make decisions)

There is an enormous amount to take into account in addition to where to invest and how much to invest to achieve goals (which in itself is a full other consideration).

Please reach out if there is anything we can help you with, wishing you a Happy and Prosperous New Year.

Bobby