Caboodle Zine

The Caboodle Zine is where we share tricks, tips and great ideas we have come across to help you get on top of your money stuff. We promise to do our very best to avoid jargon & stupid financial acronyms as such as humanly possible!

Do I need insurance?

Insurance provides you and your family with a financial back up plan when things go wrong. Consider this, you currently earn an income that pays for your living expenses and maybe your children. If you became sick or injured and were unable to work, how would you meet your living expenses? In some cases you might have sufficient assets to draw from to replace your income. However for those who don’t, insurance is a great back up plan to help fill the gap.

How much insurance do I need?

To understand how much insurance you need, it best to consider what financial obligations your family would face in the event you were no longer here. It can be beneficial to speak with a financial adviser to build a robust back up plan. However these are some important things to consider when calculating how much insurance you need.

Debts - A lump sum to clear any debts you might have. This could include mortgage, personal loans and credit card debts. If the debt is associated with an asset, consider whether the asset would be sold to clear the debt. 

Replacement Income - If your income is integral in providing for the family’s cost of living, you may wish to ensure there is a lump sum of money left behind to continue providing the family with the income when you are no longer able to.

Family Assistance - If you were the primary caregiver for your children, you may wish to ensure there is a lump sum of money left behind to assist with their care. This lump sum could allow the family to hire a nanny so that the surviving spouse can return to work. Alternatively, you might have a great support network in the form of grandparents that would assist. However it’s important to consider that they may have retirement plans that do involve regular travel and don’t involve full time care of the little ones.

Education Costs - You may wish to ensure there is a lump sum of money available to cover your children’s education costs. 

Funeral - It’s tough to think about, but you may also wish to ensure that there are funds readily available to cover the cost of a funeral without burdening the family.