top of page
  • Writer's pictureGregory Deer

How long would your savings last?

Updated: Apr 18

Understanding your financial position in the event you were unable to work through ill health or injury is an essential part of your personal financial wellbeing.

There are three key lines of defence against losing your income.

1. Sick pay

If you're employed, your company may offer some sort of sick pay. If you're self employed or your employer isn't that generous, you'll be relying on statutory sick pay. SSP is currently £109.40/week - it wouldn't cover much!

You can put a personal sick pay policy in place for short term illnesses, but you may be better off using the second line of defence for protection in these instances.

2. Emergency cash savings

We recommend keeping a minimum of 3 months of your 'noodle budget' (your minimum viable monthly expenditure) in cash savings to support you in emergencies. Find out more about the noodle budget in this blog 'How much cash should you hold?'.

It’s important to hold cash and not investments for your emergency fund, as investment values can fluctuate over the short term. When you need access funds at an unpredictable time, you don’t want to see a temporary market decline slash the value of the money you need by 50% or more.

3. Income protection

Income protection is an insurance policy that will pay you an income after you have been off work for a set time period. The maximum benefit is typically 60-70% of your current income and can continue until your state pension age or you return to work.

Income protection is your last line of defence against long-term ill health and the huge financial impact this would have on your household. Having a policy in place can support you when you need it most and many providers give healthcare support to help you back to work. You can read more about income protection in the blog 'Get ill and can't work, now what?'.

Income Protection policies generally have no cash in value at any time and cover will stop at the end of term. If premiums aren’t paid, then the cover will also stop.

The payment of any benefits may affect any claim to means tested state benefits. Some illnesses might not be included, full details will be incorporated within the Policy Summary.

If you'd like to review your position if you were to lose your earnings, we can help. Book a call with me using the link below or email


bottom of page