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Book a FREE consultation
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Get started with a free strategy consultation and receive a copy of the Good Fortune Guide – written by James McFall, Managing Director Yield FP and 2020 National Finalist Certified Financial Planner of the Year to help educate you on your Financial Plan.

How Life Insurance Can Provide For Your Family

One of the most rewarding things about being a financial adviser is seeing the positive impact an insurance policy can have on a family’s life.

 

That’s why I was particularly interested in the findings from a recent study* that explored the impact the death of a parent has on children and the surviving parent, comparing the results between insured and uninsured households.

 

I wanted to share some of the key findings with you as I think they help illustrate why life insurance for the family is so valuable.

What Impact Does The Death of a Parent Have On Children

The study found that the death of a parent can have wide-reaching impacts on children. For example, among the children in the study:

 

  • 67% took on more household tasks and chores
  • 43% reduced their involvement in social activities
  • 41% stated a worsening in academic performance.

Many children were forced to grow up faster than they would have otherwise, and unfortunately, this often comes at the expense of their social lives and their studies.

 

It’s worth noting that the parents surveyed often underestimated the impacts on their children, so the changes are not always obvious.

 

The study also highlighted some worrying trends with children’s mental health, with 29% of the children studied experiencing anxiety/panic disorders, depression, or abusing drugs and alcohol.

How Does Having Life Insurance Help?

Among these upsetting findings, it’s heartening to see that life insurance had a significant impact in helping families cope with the loss of a parent.

The most obvious impact came from an increased level of financial stability for those families who had cover in place.

 

Among families without insurance, the percentage who rated their finances as ‘struggling’ jumped from 14% to 47% after the death of a parent. By contrast, among families with insurance, the percentage of families who rated their finances as ‘adequate’ increased from 44% to 56% after the death of a parent.

 

life insurance for families

 

This financial stability had a flow-on effect to other aspects of the family’s situation. Families with life insurance were more likely to stay in the family home, increase the amount of time they spend together, and maintain childhood friendships than those without insurance.

Yield Financial Planning Is Here To Help

Whether it’s something as tragic as the death of a parent, or an illness you can recover from, it’s always nice to have the financial freedom to make the best choices for yourself and your family. That freedom is why life insurance is such an important and valuable asset.

 

*’Impact of parent’s death on the family’ – Research conducted by Ipsos, prepared for ANZ Global Wealth, June 2015
Important Note
Any information provided here is general advice only and does not consider your objectives, financial situation or needs. This information should not be taken as comprehensive and does not constitute legal or financial advice. You should seek legal, financial or other professional advice before relying on any content. Yield Financial Planning is not responsible to you or anyone else for any loss suffered in connection with the use of this information. Information is only current at the date initially published.
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About Yield - Financial Planner Melbourne

Who we serve – We help time poor professionals and business owners who intuitively know they should be doing more to improve their financial position and are seeking an expert to guide them on financial planning strategies. Our clients want personalised financial planning advice and to feel empowered and confident that they can achieve a secure transition to retirement.

What we do – We gain a deep understanding of your current financial position and preferences, what you value and want to achieve. We then help you develop a highly personalised financial plan, to show you how to make your money work harder for you. Ongoing we regularly monitor and measure progress against your plan projections, to show you how you’re tracking and help you manage change to your advantage.

How we do it – We apply our proven expertise in investment markets (Shares & Property), Tax and Debt structuring, Retirement Planning, Risk management and Estate planning, to help you reorganise the way you use your money to achieve your desired outcomes.

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