1 in 5 households would not survive financially if they lost their main income through unexpected circumstances, according to research by Scottish Widows.
Research reveals that 25% of people could only afford household bills for up to 3 months, if they or their partner were unable to work due to long-term illness.
26% would only manage mortgage payments for up to 3 months, while a further 18% say they are unsure how long they can manage with household payments.
Households are failing to take action to secure a financial backup plan with internet connection and mobile phone contracts being higher priorities for many then financial security covers such as life insurance and critical illness cover.
- 81% consider internet connection as essential, while 72% see a mobile phone as a necessity
- 29% think it’s vital to provide financial security such as life insurance and illness cover
- 40% think it’s essential to provide security for dependents if they die
- 36% would resort to their savings if they were unable to work.
Johnny Timpson, protection specialist at Scottish Widows, said:
“No matter what our personal circumstances, it is vital for all of us to ensure we have an appropriate plan in place to protect our finances, helping avoid the need to dip into our savings, which could present even greater challenges further down the line.”