It’s said that hindsight is 20/20. Whilst we can not always predict what will happen in the future, it’s often easier to see how we could have done things differently when we already know the outcome.
But wishing we’d done things differently is not the same as having a plan in place. And wishing things will be different in the future is also not the same as having a plan in place!
A wish is not a plan. Period.
Common mistakes in financial planning happen when we assume we won’t need specific types of risk cover in place. There are three types of policies that help us plan for unforeseen events that we hope will never happen but, in wisdom, realise that they might. Medical cover is one of these three.
Having no medical cover can turn the best financial plan on its head. Even a relatively minor motor accident can set you back tens of thousands, and a severe accident can cost millions, with injuries from accidents including things like paraplegia, major burns, rehabilitation and brain damage.
Severe illness is another substantial expense – including things like a heart attack, cancer, stroke, Alzheimer’s and Parkinson’s disease. These events are traumatic on a family, but they’re even harder to work through when there is financial strain.
In 2021, 61% of severe illness claims were from people under 55 years, with cancer making up the bulk of the total claims in this category (53%). In women, 65% of all cancer claims were for breast cancer, while 25% of cancer claims from men were for prostate cancer. Combined, heart attacks, strokes, and coronary artery bypass graft (CABG) accounted for 32% of severe illness claims by men and 14% by women.
Even if you can’t afford a plan with all the bells and whistles, at least have a hospital plan that will cover part of your medical expenses.
Remember, we never create a portfolio out of fear of the unknown, but out of the power to plan for the future! When the unexpected happens, it is empowering to have sufficient cover in place.