Tips for protecting your income, the majority of Australians don’t hesitate to insure our physical assets such as our home, contents and vehicles. However, have you ever thought about the importance of protecting another valuable asset, the ability to earn an income?
Although we would all like to picture a smooth and trouble free future, sometimes in life this is just not the case. Protecting your income along way unfortunately isn’t a luxury. Anyone with financial obligations should consider their back-up plan should an unfortunate event such as a job loss, business closure, sickness or injury occur.
Because of this, planning ahead for the unexpected may be something to think about for you and your family’s financial security. Here are some important tips to help you with protecting your income.
Tips for protecting your income: Increase Your Savings
Saving is a way to protect yourself against setbacks, such as losing your income or unexpected emergencies. This may be a good back up for short-term or relatively minor setbacks, and the best part is, it’s flexible. If you get into the habit of saving on a monthly basis you could keep these funds in an easily accessible savings or cash account with the best interest rate you can find, so you can access your money if needs be.
Consider Income Protection Insurance
The purpose of income protection insurance is to replace a percentage of your monthly income if you’re unable to work for a period of time due to injury or sickness. This may cover your day-to-day living expenses, giving you the financial peace of mind to focus on your recovery.
An important factor to consider is the level of income protection cover you may already have through your employer or super. If your employer or your super fund offers some form of income protection cover, you may still need to apply for additional income protection insurance or another type of insurance cover, so that in the unfortunate event of sickness or injury, you can protect your financial position.
Tips for protecting your income: Invest in Yourself
Building up and expanding your skill set could be viewed as a form of insurance. Developing more expertise and updating your skills in your chosen field makes you arguably a more valuable candidate in case you need to find a new job as a result of redundancy. Even if you don’t lose your job or get sick or injured, broadening your skills can give you more career options down the track, whether or not you choose to remain with your current employer.
Find Ways To Boost Your Earnings
Finding ways to increase your regular earnings has the potential to improve your current financial situation and make it easier to save. By doing so, you could be providing financial protection against loss of income or unforeseen emergencies. Sometimes it even lets you follow your passion as a secondary source of income. Some people make extra money by taking up part-time employment such as a part-time tutor or coach, while others create and sell arts or crafts at local markets or online. With all the opportunities out there, there’s bound to be something to suit you.