Could you make your home loan payment if you suffered from a serious illness? Recent data shows that a high percentage of Australians would be incapable of maintaining their monthly mortgage repayments if they were faced with serious health issues that prevented them from working.
After surveying 1,000 Australians, ALI group found that one of the main concerns of homeowners is if they fell ill and could not continue to make their mortgage repayments. The study showed that 12% of homeowners would immediately fall behind on their home loans in the first month if they were unable to work due to illness, with 30% after two months and 44% after three months.
Why such dismal data? Unfortunately, many people are strapped financially and any upset in their monthly budget such as unexpected bills or unforeseen illnesses that prevent a person from working can easily cause an immediate financial hardship. According to ABC News Australia, 1 out of 2 people in Australia are living pay cheque to pay cheque. To add further to the issue, those who are constantly going through the pay cheque to pay cheque cycle are not poor – they are living in wealthy suburbs who earn a good living, per Australian Property Forum.
Imagine if you became ill out of nowhere and had to take an absence from work that resulted in you not getting paid. If you’re already living week to week, it would be nearly impossible to maintain your home loan payments. In addition, it’s not just the money earners in the household that can cause a financial upset. Children or other family members becoming ill can cause an increase in medical bills, which may result in you falling behind on your home loan payments.
Given these statistics, it’s easy to see why it’s important to have income protection and a life insurance policy. Income protection insurance provides income in the event that you cannot work due to illness or injury. Illnesses and injuries can last for months, but with income protection insurance, it can help alleviate financial stress, while enabling you to still be able to meet your financial obligations. If you were no longer here, then life insurance will help fill the financial hole that you would leave, ensuring that your family can stay in the family home and maintain their lifestyle.
Don’t spend days worrying about what would happen to your home if you were unable to work due to illness or injury. By having the right protections in place, you can relieve your mortgage stress and feel assured that if something did ever happen, you have you and your family protected.
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