Service your future regularly

All / 13.12.2017

Most of us take for granted that we have to get our car serviced regularly. It’s not something we look forward to, but we know we have to do it – or it will let us down when we most need it.

A regular review of your financial plan is just as important – and for the same reason. Life changes so quickly we can forget important updates to our financial planning, particularly insurance as shown by this real life event.

Josh and Kate had their first child late last year. A close friend who knew Josh was quite casual about finance matters reminded him that their circumstances had now drastically changed. He suggested it would be a good idea to talk to his financial adviser about their insurance situation given their newfound responsibilities.

The adviser discovered that Josh and Kate had last updated their life insurance when they bought their first home three years previously. He emphasised that with the new baby, things had changed dramatically for the couple, and having insurance that only covered their mortgage would leave a shortfall should something happen to one of them.

When it was suggested they increase their cover from $250,000 (the mortgage) to $750,000, Josh was stunned! But then the adviser explained: should something happen to Josh, $400,000 would be drawn down over the long term to replace his income and allow Kate to look after their son. Otherwise she could use these funds to hire a nanny if she went back to work. Part of the remaining lump sum could be invested for their son’s future education – this being one of their current savings goals that they would not want to change.

This one option removed considerable pressure from Josh and Kate in their new roles as parents.  Having appropriate life insurance in place gives you and your family options should the unthinkable occur.

Does your financial plan need reviewing?

For more information or to speak to one of our Financial Advisers please contact TNR Wealth Management on 02 6621 8544.


Past performance is not a reliable indicator of future performance. The information and any advice in this publication does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it. This article may contain material provided directly by third parties and is given in good faith and has been derived from sources believed to be reliable but has not been independently verified. It is important that your personal circumstances are taken into account before making any financial decision and we recommend you seek detailed and specific advice from a suitably qualified adviser before acting on any information or advice in this publication. Any taxation position described in this publication is general and should only be used as a guide. It does not constitute tax advice and is based on current laws and our interpretation. You should consult a registered tax agent for specific tax advice on your circumstances.

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