Financial markets were a little more stable in December, buoyed by the latest outcomes from the European Union Leaders Summit.

The Australian share market experienced a relatively quiet month, although it still finished lower for the month and year.

You can view the full report by clicking here.

You may have questions about how these events affect your financial situation. Please call us on 08 8364 0066 and we can discuss them further with you.

The feature article is about the true value of insurance – it looks at the different types of insurance available – Life cover, disability cover, income protection and trauma insurance. It also looks at the fact that just because you have some cover through your super fund, you may not have the right type of cover, or the right amount.

There are also articles on the recent market volatility and a look at what’s happened in investment markets around the world over the past couple of month.

These articles highlight the importance of regularly reviewing your financial plan. If you would like to discuss your personal situation or revisit your goals, please call me on 08 8364 0066.

It is estimated that one in nine women will be diagnosed with breast cancer before the age of 85. The chances of being diagnosed with breast cancer are increasing, with new breast cancer cases rising from 5,291 in 1982 to 12,567 in 2007. It’s estimated that by 2015, this number will increase to over 15,000 (source : Cancer in Australia: an Overview 2010, pg 12).

Chances are that you know someone who has been touched by breast cancer. I’m 42, and some of my friends have had breast cancer. At our son’s school there are ladies who’ve had cancer and survived, and there are other people who’ve lost loved ones to cancer at a too-early age.

A quick scan of the death notices in the newspaper will show you people who have died young from cancer. A common belief is that they all thought it wouldn’t happen to them.

The good news is that the cancer mortality rates are declining. So whilst more women are diagnosed with breast cancer, the chances of dying from it are reduced.

If you know anyone who has had a debilitating illness like cancer, you’ll know that it affects their lives in a number of ways – not just the physical issues of treatment, but emotional issues due to the worry and stress of the situation. Invariably, there’s also a financial cost that is borne.

As part of our financial coaching process, we look at the risks associated with your wealth accumulation, and suggest strategies to minimise the effects of those risks. Whilst it’s impossible to stop someone being diagnosed with cancer, it is possible to help with the financial impact of such a diagnoses.

Consider the example of Rob and Julia, both in their 40’s. One day Julia noticed a lump in her breast, went to her GP to get it checked out and, after a few tests was diagnosed with the early stages of breast cancer.

She underwent treatment to get the lump removed, and also had a course of chemotherapy. She was off work for over six months whilst all this was going on.

The financial impact of this on her family was huge. The loss of her income made a big difference in their day-to-day spending, and they had to cut back to survive. Rob took some time off work to look after Julia, but after his sick leave ran out he had to return to work, as they couldn’t afford for him to have leave without pay when they were already without Julia’s income.

Eventually Julia was able to return to work and the family returned to two incomes, but the damage was done.

There are ways to reduce the financial impact of a trauma claim.

If Julia had an income protection policy, she could have received a benefit of up to 75% of her income for every day that she was off work, after a short waiting period. Whilst it would have still been a reduction in their income, it wouldn’t have been as significant an impact as the loss of all her income. This income would have enabled them to still maintain a similar income while dealing with  the cancer diagnoses.

A trauma insurance policy would also have helped. This would provide a lump sum upon diagnoses of the breast cancer. This lump sum could have been used in a number of ways:

• Cover medical bills and out of pocket expenses.
• Provide a lump sum to facilitate travel interstate or overseas for any experimental treatment that may be available.
• Reduce debts so the family didn’t need to worry about losing their home.
• Enable the other partner to take time off work without pay.

If the worst happened and Julia died from her illness, life insurance would pay a lump sum to her family that could be used to repay all debts, secure her children’s future education, and provide additional money to enable Rob to spend more time with his kids if he chose to work part time, or to hire a nanny to look after the kids if he still intended to work full time.

It can happen to you!

I’m an optimistic person and I don’t want to think that something like this will happen to me. But it could. Cancer doesn’t discriminate and you can lead a healthy lifestyle and still be diagnosed with it. That’s why I’ve made sure I have sufficient income protection, trauma and life insurance to look after my family (and me) in the event something like this happens.

What about you?

What would your financial situation look like if you were diagnosed with breast cancer? Do you have a large cash buffer to cushion against the loss of income? How would you keep paying your mortgage?

At Impact Financial Coaching we’re  experienced at helping people work through these questions. We’ve done it with many clients over the years and have helped them put in place strategies that protect them from the financial risks that a serious illness can bring.

Call us today for a free analysis of your situation, where we’ll be able to give you some insights on how you can manage your finances better.

One more thing…don’t leave it until it’s too late. There are reports that during the Victorian bushfires homeowners were calling insurance companies trying to arrange house insurance cover as the fires were advancing on their homes. The insurance companies won’t provide cover in this sort of scenario.

It’s similar with trauma cover and other personal insurances. If you’ve already been diagnosed with a form of cancer, however insignificant it may have been, you’ll find it difficult to get any insurance cover that will protect you against that kind of illness. The insurers won’t take the risk.

So don’t delay. This is something that needs to be looked at whilst you’re healthy, not when you need it the most.

Call us today on 8364 0066 to find out more.

Main photo -  Some rights reserved by SCA Svenska Cellulosa Aktiebolaget

Unless you’ve got a very simple hairstyle, you probably wouldn’t dream of trying to cut it yourself.

You could read a lot of books about how to cut hair, but you probably wouldn’t have the confidence to cut your own hair.

Why?  Because you can see straight away if you’ve done a bad job.

If you persevered and cut your hair regularly, you may get better, but it would take a lot of time, and you’d have to put up with the results in the interim.

There are some things you just shouldn’t do yourself.

I’m amazed at the number of people I know who try and do their own financial planning.  I usually point out to them that what they’re doing is not financial planning, but investing and speculating.  You see, my friends here in Adelaide are happy to mention their investing prowess, but have neglected the other important aspects of financial planning.

• Very few have income protection.
• Few have sufficient life insurance.
• Only a couple had heard of critical illness insurance.
• Many don’t have Wills or Powers of Attorney.
• Many don’t understand how superannuation works.
• Most have no plan – just a vague idea of investing in shares.

The problem with the casual DIY investor is that there’s no immediate feedback by which they can judge themselves – unlike a DIY haircut.

If they invest in shares and the shares increase in value, they think they’ve done a good job.  But compared to what?  If your investment grew by 10% but the average return from the market was 15%, have you done a good job?

It’s time to outsource.

There’s so much in life that we can outsource – mowing lawns, cleaning, fixing the car, even getting someone to cut your hair!  But there’s plenty you can’t outsource – looking after relationships, your health, experiencing life etc.  My friends here in Adelaide tell me they don’t have enough hours in the day to do the things they want to do, yet some still try and do their own financial planning.

So maybe it’s time to join up with a good financial planner who can help you look at the big picture and get you on track.  If you’re not already a client, call us today on 08 8364 0066 to find out how we can help you make a difference in your world.

photo credit London looks

This article was written yesterday (the 8th August 2011), and deals with events up to the end of last week. Of course, this week has brought a fresh set of challenges, notably the downgrading of the US’ credit rating.

The falls of last week, particularly on Friday 5 August (Thursday in the US), were a culmination of a series of broad global concerns that have existed since 2010. Importantly, they were not a result of any new piece of data or isolated significant event. Around the world, investors were suddenly gripped by fears about slowing growth in Europe and the US. At the same time, people seemed to realise that these governments still don’t have effective long-term solutions to their well-publicised debt problems.

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Times like this will affect different investors in different ways. For some it represents a good buying opportunity. For others its a time to re-evaluate the level of volatility they’re prepared to accept. Whatever your stage in life we encourage you to contact us to discuss how these changes affect you.

A regular income stream from an Allocated Pension or Annuity can be an effective way to fund your retirement. It’s important to understand how they work, to ensure they are right for you.

Click to learn more about Allocated Pensions and Annuities.

The feature article is about superannuation – it looks at the superannuation contribution caps, death benefit nominations, when you’re able to access your superannuation and the need for diversification.

We also have  an article called ‘Securing Your Family’s Future’ which looks at things to consider when making out your Will.

These articles highlight the importance of regularly reviewing your financial plan. If you would like to discuss your personal situation or revisit your goals, please call me on 08 8364 0066.

Market Watch is a monthly newsletter which looks at the performance of the various economies and asset classes over the past month.  It discusses the key economic events that occurred globally and looks at how they effected financial markets.

I hope you find the information in this newsletter valuable. If you have any questions or concerns about investment markets or financial planning, please don’t hesitate to contact us.
photo credit: alancleaver_2000

Recent media attention about the 2011–12 Federal Budget may have you wondering how the proposed changes will affect you.

In a relatively conservative announcement, the Budget delivered some changes around superannuation, taxation and social security benefits.

If you have any questions about how the Budget or proposed government initiatives may affect your financial situation, please don’t hesitate to contact me on 08 8364 0066.

Market Watch is a monthly newsletter which looks at the performance of the various economies and asset classes over the past month.  It discusses the key economic events that occurred globally and looks at how they effected financial markets.

I hope you find the information in this newsletter valuable. If you have any questions or concerns about investment markets or financial planning, please don’t hesitate to contact us.