We all have plans, but financial wellness means being as prepared as possible for the unexpected. From your boiler breaking down to a job loss, or the death a loved one.
Whether you are facing a temporary or permanent financial loss, it helps to have some emergency savings and protection in place. There are small steps you can take today to feel more in control.
We asked how far in advance people plan for their financial needs and found that only 23%* plan for over a year ahead.
Having a rainy-day fund for unexpected money shocks, like an unexpected event or bill, is a great foundation to safeguard yourself, your lifestyle, and your family.
You can start by aiming to save around one month’s income, but it's ideal to have at least three to six month's income saved. It’s a good idea to build this up over time, and make sure it’s kept in a separate bank account.
Insurance may protect you, your loved ones and your belongings from the cost of something going wrong.
If something unexpected does happen – such as a burglary, a car accident or an illness – it means you won’t have to bear the full financial cost on your own.
You may be familiar with insurance for your home or car, but there will come a time when you need to protect things even more important – your life and income. Insurance for these things means that you and your family are taken care of if the worst should happen.
Life assurance |
Critical illness cover |
Income protection |
|---|---|---|
| Life cover pays an amount to your family or dependents if you die within the term of the policy. It’s helpful to think about what you want the money to cover when you set the amount – for example, to clear a mortgage or debts, pay funeral costs, or money to support family living costs. | This can be bought as a separate policy or alongside life assurance. It pays a set amount if you are diagnosed with one in a list of serious medical conditions, such as cancer, even if you recover. You should consider the key expenses or bills you might want it to cover. Don’t forget to think about the costs for things like help with your recovery or adaptions to your home should you be less mobile. | Income protection covers your wages or salary should you become unemployed due to an accident or sickness. It pays out for a fixed period, or until you start working again, retire, or die. You can set the policy to pay a replacement income, or just to help cover essential bills. |
It’s really important to think about what you can do to protect the savings that you’re working hard to build up. This includes anything you have that you might want to pass on to your loved ones when the time comes, as well as your retirement savings.
A quick summary on protection
*The Fidelity Global Sentiment Survey, 2023. The sample consisted of respondents with the following qualifying conditions: aged 20-75, either they or their partner were employed full-time or part-time and had a minimum household income of: Australia: A$45,000 annually; China: RMB 5,000 monthly; Hong Kong: HK$15,000 monthly; USA: US$20,000 annually; Canada: CA$30,000 annually; UK: £10,000 annually; Mexico: $4,500 MXN monthly; Ireland: €20,000 annually; Germany: €20,000 annually; Netherlands: €20,000 annually; France: €20,000 annually; Italy: €15,000 annually; Spain: €15,000 annually; Japan: 1.5m yen annually; Brazil: R$1,501 monthly; India: ₹55,001 annually, Singapore: SGD$2,000 monthly; Denmark: 100,00 DKK annually; South Korea: 1m KRW monthly; Switzerland: 20 CHF annually; KSA: 4,000 SAR monthly; Sweden: 180,000 SEK annually; UAE 29,000 AED monthly; The data collection, research and analysis for the above markets was completed in partnership with Opinium, a strategic insight agency. Data collection took place in July 2023. Reporting and analysis took place between July and October 2023.
Overview
