The current housing crisis has been discussed by far more qualified commentators than me over the last 5 years, but less focus has been on the unforeseen and (as yet) unaddressed by-products of this situation – an absence of financial advice.
For most people, engagement with Financial Services comes at a particular phase in their life. Most often, it is associated with the decision to move from rented accommodation to buying your own home and the necessary planning that comes with it. With your Financial Broker you learn what is required of you to apply for lending.
Cleaning up your current account and putting in place a savings plan is often recommended and, while sometimes painful, this can have the benefit of creating positive habits with your money that last a lifetime. Similarly, extending the conversation to the areas of retirement planning and life & illness protection can be worthwhile if understood and appropriate.
Without this ‘trigger’ to look at your personal finances, many people continue to drift into subsequent life phases without ever looking at their circumstances, and this can have serious implications. Added to changes in the way families are structured, there can be significant exposure in a range of areas.
My speciality is Family Financial Protection and this area has changed significantly from a decade ago. These are the main issues we see with clients today:
- Inability to Pay: For all the criticism they take, banks can be talked to. If you find yourself unemployed or out of work due to illness, it should be possible to talk to them about financial assistance – either reduced mortgage payments or a break for a period of time. Renters in the private sector have no such capacity. An Illness could lead to eviction and homelessness in a very short space of time.
- Death: If you have a mortgage, you are obliged to have a policy in place that pays it off if you pass away. This means, at worst, that your partner or family have a debt free home to live in or sell. Also, many people take out additional insurance to leave something behind, ensuring their family is protected.
- The Law: The old fashioned nuclear family (Mother, Father, their children) is no longer the only family unit in this country, but unfortunately our legal & financial systems are not yet equipped to deal with unmarried partners, children from past relationships etc. when it comes to the impact of illness or death.
The irony of the situation in this country is that the people who most need to have their circumstances addressed in a pro-active manner are usually the ones with the least done.
So if you recognise yourself in this article, make an appointment today with a Financial Advisor. Solving these issues is not difficult or expensive, and you’ll feel a huge sense of relief and pride when you do.