A global pandemic is a trying time to live through. And there might be unfortunate side effects of the coronavirus lockdown, for example, divorce rates might increase. Since life policies usually get cancelled in these instances, you will need to consider how you’d cover maintenance payments for your children if you ever lose your income.
This does not constitute advice and advice should be sought in all instances before acting on it.
If you need to find a way to provide for your family if you can no longer work due to illness or you prematurely passing, Family Income Benefit (FIB) might be the solution.
Family income benefit (FIB)
If you’re lucky enough to have a flexible life cover plan, some couples may be able to split their policies and keep their cover. But for those who are not so lucky, they will lose their coverage and need to find an alternative way to provide for their family.
If you are legally bound to provide maintenance payments to support your children, FIB might be the best way to ensure you will have a way to provide for your children, even after divorce, in the event that you lose your source of income or you prematurely pass away.
Apart from being able to replace the regular income lost due to an illness or death, a few of the other benefits of FIB include the income being paid tax-free, it can be written in trust or on the life of another, or it can be set up on a level or indexed basis.
Who could benefit?
FIB is for anyone who needs a low-cost, simple solution to provide their family with income payments, rather than a lump sum, in the event of their death. It is especially useful for people with young children who would be able to receive payments until they’re of age.
A premium could be a fraction of what your maintenance payment is, so it’s worth it to invest in a policy that ensures your family is provided for long after you’re gone.
If you and your ex-partner want to ensure that your children are provided for no matter what happens, consider FIB.
Everyone wants their children to grow up in a safe, secure, and loving environment without any worries, especially financial ones. You’ll need to take into account: regular bills, holidays, birthdays, Christmas, and any other needs or wants to get a good idea of exactly how much you need to provide.
Talk to us
If you would like more information about Family Income Benefit or any other protection policies, Dental & Medical Financial Services can help. We’re happy to discuss with you the benefits of protection and incorporate any additional policies into your overall financial plan.
Darren Scott-Guinness, our financial expert, is on-hand and available to talk through your financial protection at a time to suit you. We’re just a call, text, or email away, so don’t hesitate to reach out today.
Considering the best way to protect your children’s future?
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