Over seven million UK parents (64%) feel they have inadequate financial protection in place to look after their children should they die or become ill.
According to research by Bright Grey, a staggering 1.6 million parents (15%) admit that they have never thought about how their family would survive financially if the worst happened, with a further one in 10 expecting their children to live off family savings.
The research highlights a startling lack of awareness regarding
protection policies, says Bright Grey proposition director Roger Edwards.
Just don't want to think about it
"People don't want to think about the financial consequences of themselves or their partner not being around, but it is one of the most important areas of your finances to get right, especially if you have a dependent family,” says Edwards.
“It is worrying that so many families admit to not having sufficient
protection in place, but are doing very little to address this.”
"People might be shying away from sorting out cover because it seems a time consuming task or an expense they don't need at the moment, but the cost of life cover has been falling over the last few years."
Bright Grey estimates that for less than £20 a month (the equivalent of putting aside £2.84 per day for a week) could buy a male, aged 30 next birthday £87,000 worth of cover - a figure that would take more than a lifetime to achieve for those parents saving £1,000 a year.
Pensions also need urgent attention
In other news, it is estimated that retirement savers are missing out on an extra £720 million tax relief by not making additional
pension contributions.
According to financial site Unbiased.co.uk, High-rate taxpayers who fail to make Additional Voluntary Contributions (AVCs) will be the worst hit.
AVCs run alongside employers' pension schemes and allow employees to pay extra into their pension which should result in a larger pension pot at retirement.
"Failing to save for retirement has become an increasing problem for the UK population,” says Unbiased chief executive David Elms.
“The onset of the credit crunch has further compounded this problem as the value of people's pension funds is decreasing and they are also finding their money doesn't go as far as it used to.”
Elms suggests that taxpayers contact an IFA to ensure they are planning effectively for their retirement.
