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Life Insurance

If you have dependants, life assurance is more important than investments. Investments take longer to accumulate to the level that may be required by your dependants, whereas life assurance benefits can immediately meet those needs if required.

Life Insurance

Do not take out a life assurance investment contract for more than 10 years. You don’t know how your financial position could change. At the end of the period you can always extend the contract, but if you have to cut it short, there are penalties involved that could see you getting back less money than you paid in. The main reason life assurance sales people attempt to get you to take out longer-term policies is because they receive more commission.

It is not saving if you put money away at the start of the month but withdraw it before the end of the month. Life assurance/(Insurance) investments are useful for people who find it difficult to save, because they commit you to a contract for at least five years and cost you dearly if you break the contract.

If you can afford a hamburger and Coke every day, you can afford life assurance. Life assurance is essential for anyone who has dependants. More info to come throughout the week.

If an investment product is too complicated to understand, avoid it. It does not mean you are stupid. It simply means that the product provider and/or financial adviser are trying to baffle you.

Always check how much commission is being paid to your financial adviser. Some financial products – particularly those offered by so-called linked investment product providers – come with particularly high costs and commissions. High commissions can be a perverse incentive for advisers to mis-sell.