A new year often means that you are setting yourself goals to achieve in the coming year and in financial planning it is important that your family is looked after if anything should happen to you. If you are in a couple and have kids, the focus should be on whether both incomes would still be required if either party was to pass away or become seriously ill?
All ‘protection planning’ should be bespoke to an individual’s circumstances. The three main covers are life and/or critical illness that tend to pay a tax-free lump sum and income protection that pays out an income if you cannot work due to accident or illness. A general rule of thumb is to take out life and/or critical illness cover for any mortgages you may have, to make sure your house is paid for. However often this is insufficient in itself as it does not take into account how the running costs are to be met by continuing to live there.
It is also important to make sure any pensions have a completed ‘Nomination of Beneficiaries Form’ so that benefits are paid to the correct person on death. As a general rule all of the above should be covered off within a Will.