The Other Money Must-Haves The not-so-obvious financial protection measures you need

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There’s not a single modern-day platform that won’t mention all the financial imperatives: save 10% of your income, ensure you have a retirement annuity in place, diversify your portfolio and spend less than you earn. Have these financial must-haves in place and you have made fundamental steps towards financial freedom…

Written By: Zimasa Qolohle Mabuse

As diligent as it is to manage your finances and put steps in place to build your wealth and assets, there are other financial products and measures that one should endeavour to possess to secure themselves against the unfortunate incidents that life inevitably throws at us. Some examples can be listed as follows:

  1. Medical Aid/Insurance

Insurance, in any form, is often seen as grudge purchase; an extra amount of money coming off your account to be used for an event that may or may not happen. Moreover, when times are tough, cutting down on these ‘grudge’ purchases is often one of the first options beleaguered consumers do to relieve their financial pressure – surely we could be doing better things with that deducted amount? Well, cancelling your medical scheme membership to save money in the short term, may cost you and your family dearly in the longer term, as in the event of a grave illness or hospitalisation, the financial impact could in turn leave you in a worse off position.

Possessing medical aid or insurance ensures

  1. that you have access to better hospitals and services in the event you or a dependant falls gravely ill
  2. you are not burdened with the cost of paying extra money on a monthly basis for specialised medicines should you have a chronic illness
  3. you do not have to bear the costs and fees of any unexpected hospitalisation necessary and
  4. You have access to vital healthcare services such as dental care, optometry, physiotherapy and so forth

Save yourself the financial burden of large fees that would have come from your very pocket by taking the time to find a medical scheme suitable to you. Contrary to public perception that all medical scheme options are expensive, most schemes offer affordable, low-cost and entry-level options to suit all members’ needs. Conduct your research and protect yourself financially by having medical insurance in place.

  1. Life Cover or Bond Cover

A staggering 70% of South Africans do not have life cover in place. This is partly due to a lack of financial education, along with the false belief that life cover is expensive. Simply put, life cover is a lump sum amount cascading from a monthly debit order that will be paid to your beneficiaries or estate in the event of your death. This amount ensures that any outstanding debt and due payments that you had acquired at the time of your death, are settled, and these said costs are not borne by your surviving family members. Bond cover, is the exact same concept, however the lump sum paid out to your surviving family members is used for the sole purposes of settling the remaining balance owed against your property.

The benefits of possessing life cover or bond cover are endless in that

  1. if your loved ones depend on your financial support for their livelihood, then life cover aids in replacing your income upon your passing.
  2. it’s a great method of leaving an inheritance. Even if you don’t have any other assets to pass to your heirs, you can create an inheritance by buying a life cover policy and naming them as beneficiaries.
  3. Without a doubt, having life insurance coverage will bring you and your family peace of mind. It’s one thing you can be sure of and you’ll no longer have to question whether they’ll be taken care of when you’re gone.

  1. Income Protection

Whether you’re employed by a company or are a self-employed professional or entrepreneur, your monthly salary is one of your biggest assets. Without it, having a worthy standard of living can be incredibly difficult. In the event that you are unable to work and therefore cannot earn an income, your life and that of your dependant’s can be jeopardised. Income protection allows you to be able to take care of yourself and dependants financially, regardless of what life event negatively impacts your income. Most financial service providers and insurance houses have a variety of packages of comprehensive benefits that aim to protect you against a wide range of risks that could negatively affect your income, and also give you the opportunity to decide on the extent of your coverage based on what stage of your life you are in.

Although one cannot argue how imperative putting aside money for savings and investments is, the benefits of possessing other forms of financial assurance cannot be ignored. Protect your finances and wealth by slowly implementing the measures listed above, to ensure you aren’t left in a worse position in the event of unfortunate circumstances.


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