Get your life assurance while you’re young!

Some people make the mistake that life assurance is only for middle aged and older people, who are starting to question their mortality. In fact it is viewed only as a necessary evil by younger people, many of whom only take out cover when they are forced to, for example when getting a mortgage.

But actually it makes a huge amount of sense to get life cover in place while you are still young, for a number of reasons

Life cover is cheaper (for the duration of the policy) for younger people
Life cover gets progressively more expensive as you age. Younger people get cover at the lowest premiums and under most term assurance policies, this price is then locked in for the full duration of the policy. So yes, while there is a small premium to be paid for cover (as opposed to no premium payable if you don’t have any cover), this premium then remains at this same level out into the future.

You’re healthier and more likely to get better terms (for the duration of the policy)
Young people are generally healthier than older people. That’s a simple fact. And because they are healthier and may not as yet have suffered medical conditions that they are destined to face in later life, young people find it easier to access life assurance cover at the lowest rates. If you are unfortunate enough to be diagnosed with any sort of a serious condition in later life, you can expect that your life assurance cover will be more expensive as a result of loadings to reflect your medical condition, as well as the fact that you are older. So getting life cover in place while you are young and healthy will help you avoid premium loadings.

You’ve less negative family history to impact the cost
Similar to the last point, another factor that impacts access to and the cost of life assurance cover is family history. If for example there is a family history of chronic illnesses, this will negatively affect your life assurance policy. Younger people have younger (and generally more healthy) parents. This means a more positive family medical history, and as a result more favourable policy terms.

You can protect yourself against future policy changes
Life assurance policies evolve in line with changing circumstances. When we think back to the likes of the HIV and AIDS epidemic of the 1980’s, one of the immediate impacts of this was a 15% hike in the cost of life assurance policies. Of course this hike only applied to new policies taken out from that point forwards. So getting in at a young age protects you against such future events. Of course if premium rates reduce (which they have also done from time to time), there is nothing to stop you switching to a new, cheaper policy. So you can win both ways!

Lots of reasons to consider life assurance in your early years....

Looking for Savings Tips? Think broader than Deposit Accounts…

As the economy continues to recover and many consumers are again starting to have a few bob left over at the end of the month, the question for them now is what to do with this extra money. In the past, this money was diverted into a deposit account to keep it separate from the day-to-day spending within your current account. But with interest rates now hovering around 0%, this really is a questionable approach. One of the questions that Financial Brokers are most frequently asked today is, “What is the best savings plan for my money?”

The answer to this needs careful consideration if proper savings advice is to be given. What are you trying to achieve with your savings – are you saving for a rainy day or have you a specific goal in mind, maybe to fund education in future years or to buy a new car? What are your time horizons or do you have any? What is your appetite for risk?

A deposit account is a suitable vehicle if you are putting money away in the very short term. It is accessible and secure (at least up to €100,000). But if your target is to save for a number of years, deposit accounts come with a price. As long as price inflation exceeds the interest rate payable (which remember is pretty much 0%), the value of your money is falling all the time. You won’t be able to afford in the future the things that you can just about afford today. Therefore the first of our savings tips is to consider your timeframe very carefully!

Our second savings tip is to consider your appetite for risk. If you are not satisfied with your money effectively losing value every day as it sits on deposit, a Financial Broker will help you identify your own tolerance for risk, and will then help you identify how much risk is appropriate for you within a savings plan. Once you know the appropriate level of risk, they will then find the best savings plan to meet your specific needs. This might in fact be a deposit account, or instead it may be a savings policy with a life assurance company. The one thing you can be sure of though is that you are getting the right savings advice to meet your specific needs.

Ultimately, understanding what you are trying to achieve with your money sits at the heart of this. Once you are clear on the end goal for your money, your timeframe and your appetite for risk, you can now start planning with confidence. This brings us to our final savings tip! Talk to your Financial Broker and get their help in planning your savings approach. This is definitely a better way forward than blindly placing your money on deposit and watching the value of it erode away over time.

Mortgage Protection: the Costs v the Benefits

Mortgage protection is often viewed as a grudge purchase. A necessary evil insisted upon by banks when consumers are at the pin of their collars, trying to buy a new home. But is this the right way to look at it? Because of the financial pressure people are under when starting out with a mortgage, they often forget about the benefit that they are actually paying for.

First of all - the Costs
Mortgage protection is actually a cheap form of life assurance. This is because the level of cover reduces in line with your reducing mortgage balance, unlike more traditional life assurance cover that remains constant (or even increases) during the life of the policy. Remember, the purpose of this cover is simply to repay your mortgage in the event of your death. 

There are other reasons behind the cost of this insurance for your life usually being quite low. Mortgage borrowers are often young couples, which in itself results in lower premium rates for them. On top of this, non-smokers see significant reductions in rates in comparison to smokers.

We’ve also seen a significant reduction in premium rates in Irish life assurance policies in recent years. This has been as a result of more favourable claims statistics – less people dying young, due to significant strides in medical science in the last few decades.

Even aside from these factors though, you want to ensure that you are availing of the lowest cost cover in the market! To do this, you need to engage the services of a Financial Broker who will find the best insurance quotes in the market for you. This is a job your bank cannot do – they are stuck with the products of a single provider.

And did you know that your bank cannot insist on you taking out the life assurance policy with them? They can only insist on the cover being in place. So stand up for your rights (and your pocket!) and ensure you get the lowest cost cover in place through your Financial Broker.

The Benefit
Don’t forget the benefit! The primary benefit of mortgage protection cover is the security that it gives you. The comfort of knowing that should you or your spouse die, your family home is secure and is one less worry for the bereaved to deal with.

None of us like to give these situations too much thought… But it is important to consider that in the event of a death in the family, this often results in the loss of an income, sometimes the sole income coming into the household. Then the mortgage repayments become a problem and then the bank is chasing you. All on top of your grief of losing a loved one.

So recognise the comforting benefit of this cheap life assurance. Talk to your Financial Broker about getting the best insurance quotes for you. Get your cover in place and enjoy your new home without worries.

Where do you buy your life assurance?

All life assurance policies are the same? The best place to buy life assurance is online or from your bank? The only thing to consider when buying life assurance is the price? Well in fact the answer to each of these questions is, FALSE!

Life assurance policies differ from provider to provider
The days of life assurance policies all being exactly the same are long gone… With people living longer now than they used to and recovery rates from illnesses improving all the time, the cost of life assurance has fallen significantly in recent years. As a result, the providers now compete both on price and through the addition of valuable policy benefits. Are you aware of the following?

• There are life assurance providers that will give you access to the best doctors from around the world, for a 2nd opinion when you have a serious illness?
• There are life assurance policies that will pay out your benefit immediately while you are alive, if you have been diagnosed with a terminal illness?
• You can get life assurance policies where the cover increases automatically each year, policies that pay out when the first of you or your spouse dies or indeed policies that pay out twice when each of you die.
• You can get life assurance policies to protect yourself, your family, your business partners, key employees, even to protect against you leaving an Inheritance Tax bill when you die.

So all life assurance policies are definitely not the same!

Buying online or from your bank only narrows your options
The problem with buying life assurance online or through your bank is that it will seriously narrow your options. Both of these sales channels will usually only have access to the products of a single life assurance provider. So apart from you potentially not getting access to the cheapest life assurance cover, you may well also miss out on some of the really valuable enhancements available.

A Financial Broker on the other hand has access to a broad range of life assurance products in the Irish market. They will find the right provider, offering the best product at the best price for you and your specific circumstances. They will also do all the work for you in terms of getting the cover arranged!

Life assurance is about more than the price
Of course the price is really important when you are buying life assurance. In fact your Financial Broker will often be able to match the lowest price in the market on the actual product that you want! Now that is really adding value! But your Financial Broker will add far more value than that. Apart from the price and added benefits, they will also consider factors such as,

• The claims payment records of the various providers
• The financial security of the providers
• How easy the providers are to deal with

Your Financial Broker is definitely the best place to buy your life assurance!

Where do you invest €10,000 today?

Well everyone seemingly has an opinion on this question and will give you a quick answer to it! Well that’s anyone with the exception of a Financial Broker, who is unlikely to give you a quick answer to such an important question. Because what to invest in is not about going with fads or trying to pick a winner as you might in a horse race. Instead finding the best investment opportunities needs to based on a very systematic approach and on your own particular circumstances. And that’s where a Financial Broker will help you.

Your Financial Broker will first look to become crystal clear on your investment objectives. Why are you investing? What is your end goal for the money? What is your investment timeframe? It’s only when they get clear on these types of questions that they can start to even think about what to invest in. Investing money in Ireland today is full of opportunities and pitfalls, it is really important that your Financial Broker understands your objectives fully first.

Understanding your attitude to take risk is the next essential step in determining the best investment for you, because what might be considered the best investments in Ireland may not be the right investment for you. At the end of the day, we are all different when it comes to what we consider acceptable risk in relation to our investments. For some people, they want to always get back at least their investment amount after a set period of time, even if this means lower potential returns. For others, they want to aim for the maximum possible returns and can happily sleep at night even if they risk losing some of their money. Your Financial Broker will ask you a series of questions that will help you to determine your personal appetite for risk (are you happy to take risk or not?) and also your capacity to take risk (can you afford to take risk or not?). This will guide them further towards the right investment opportunities for you.

Your Financial Broker will then want to know your full financial circumstances to see where your investments sit in your overall financial affairs, as this may also shape the suitability of individual products.

When they have all of this done, your Financial Broker will then research all of the best investments in Ireland to find the one that suits you. Unlike a bank or life assurance company salesman, they are not tied to advising in relation to the products of one company. They will find the best product to meet your objectives, one that fits with your attitude to risk and that also suits your specific personal circumstances.

So back to the question of where do you invest €10,000 today? We still can’t tell you the answer, but using the services of a Financial Broker will ensure that you end up getting the best result for you.

Critical Illness Cover – Recover your health without financial worries

None of us like to think about getting sick and the worry this would cause for our loved ones and ourselves as we do our best to get well again. The last thing we would need is to be worried about money. Often, this is a real concern. Apart from the impact an illness might have on your income or indeed your business, you may need access to additional cash to pay for care at home, possibly to adapt your home, or to buy medical equipment that will assist your recovery or improve your quality of life. Indeed critical illness cover is often linked to a mortgage, paying off some or the entire mortgage in the event of you getting sick. 

Critical illness cover, sometimes known as serious illness cover (or specified illness cover) is a product designed to remove the financial worry when you suffer one of a specified list of serious illnesses. Critical illness cover has been a very popular addition to the protection portfolios of clients in Ireland for the last 20 or so years, the attraction of it being the availability of an immediate lump sum in the event of a claim.

Is it likely to happen to you? Well hopefully not, but according to the National Cancer Registry Ireland, there are more than 20,000 new cancer cases in Ireland each year. Their statistics also show however dramatic improvement in 5-year survival rates, due to the advancements in medical science. The picture is the same in relation to heart disease and strokes. Approximately 10,000 Irish people have a stroke each year and there are approx. 30,000 people living in the community with disabilities as a result of a stroke, according to The Irish Heart Foundation. But of course while surviving is good news, money is also needed to enable you to recover without worry.

There have been some great innovations in critical illness cover in recent years. While claims are allowed on approx. 40-50 specified illnesses, some insurers will also pay out partial amounts on other illnesses or sometimes for serious accidents. Some insurers also provide cover for children free of charge. It is even possible to access a second medical opinion service with some of these types of financial products.

Where do you find the right critical illness cover for you with the most relevant benefits? This is where your Financial Broker comes in. Unlike a bank with access to the product of a single provider, your Financial Broker has knowledge of and access to products across the marketplace. Depending on your own circumstances, they will find the best critical illness policy with the right set of benefits at the lowest cost to suit your own personal circumstances.  

Getting sick is of course a time of concern. However you can take the financial worry out of it by asking your Financial Broker to find the right critical illness cover for you.

What would you do to save €2000 a year ?

The Central Bank of Ireland recently announced that there are over 100,000 households with mortgages, who could get a better deal by simply switching their mortgage. What most banks rely on is that people will not want to have to go through the hassle of switching, but have you really considered enquiring about reducing your monthly mortgage cost?

Example:

If we use a mortgage of €240,000 on a house worth €300,000 (80% Loan to Value) and a variable rate of 4.5%, the rough cost of interest payments per year is €10,800. Currently, one Mortgage provider offers 3 year fixed rate of 3.6% for mortgages that would yield an annual saving of €2,160. That’s €180 a month less in interest repayments just by moving mortgage providers!

Is there a lot of work involved?

The first step is to put in an enquiry to see if it’s worth your while. This is not a lot of work and shouldn’t take long. If you decide the savings are worthwhile, you would then have to consider if you wanted to proceed with an application.

In this regard, the real question you should ask is “am I prepared to put in a little work getting documents together to make monthly savings on our mortgage?”. Your mortgage provider is hoping that you are prepared to pay more to avoid the hassle involved in switching to a cheaper provider.

Isn’t there a huge cost involved?

There are costs involved but the main costs are usually the legal ones. Some mortgage providers now cover up to €2,000 of potential legal costs. This would make the process far less costly. But even if you had to cover the entire legal fees, if you were saving over €2,000 a year, it would still be a cost saving exercise.

Can I make any other savings?

There is a good chance that many people took mortgages out directly with the banks and were required to take out Life Assurance (e.g. Mortgage protection). In many cases, this was not the cheapest cover available. By reviewing your mortgage you can also review your Life Cover.

How do I know if it’s worth my while?

If you have a mortgage that is currently 90% below the value of your property (90% LTV), you may be able to make substantial annual savings. The lower the Loan to Value (LTV), the better the rate/savings you will be offered.

I am interested, what do I do?

If you contact me by phone/email, I can begin a pre-enquiry. This shouldn’t take long and all you are doing is seeing if it’s worth your while. You are not obliged to proceed and will not incur any cost at this stage. Asides from a few minutes of your time, what do you have to lose?