Personal Insurance Or Move Back In With Your Parents …. Which Will It Be?


I’m sure my headline has attracted your attention however there is nothing fictional about the title!

There is no doubt that we all love our parents as they are usually always there to provide support when it’s needed most.  For many of us myself included, we have moved on & started our own lives.

Whether you are married or single it’s fair to say that you enjoy your independence or freedom to live your life either on your own or with your family.

Our independence & freedom are more or less controlled or determined by our financial capacity.  I think it’s fair to say that the higher our income the greater the choices we have.

That’s right things are going well, your business is making money, your children are doing well at school & you are able to go on that holiday each year.

Until Something happens.

It could be a serious illness or a medium to long term injury or worse still, death!

The point is that our lives can change in a second through one of the above events occurring to either ourselves or another family member.

So what happens next?

There are three main scenarios.  You have no personal insurance in place, you have some personal insurance in place or you have adequate insurance in place organised through your adviser.

I can tell you now that working in the industry I very rarely come across the last scenario so I think we can focus on the the first two.

In regards to having some insurance in place this normally relates to default levels of cover within industry super funds.  Studies have shown that in most cases both the type & level of cover within the fund is usually not adequate enough for the members needs.

With this said, at least members of employer super funds have some cover in place which is always better than none.

For those with either no insurance or very little insurance in place, what happens now?  This is where your parents fit into the equation.

First of all lets focus on a married couple with children.

In most cases there is usually a sole or dominant income earner amongst the couple.  Traditionally this has been the male, however these days it is just as common for the female to be the main income earner.

There will obviously be a greater impact financially if something happens to the main or sole income earner of the family.  Death & permanent disability will obviously cause serious financial problems however so too can temporary disability.

Without an income, bills can’t be paid including the mortgage repayments.  This means that the family home may need to be sold with a best case scenario of the family downsizing if that’s an option.

If the purchase of a smaller home is not an option financially then the next realistic option is to seek assistance from your parents.

By assistance I mean having to move back in with your parents whether it be short, medium or long term for financial reasons.

The situation becomes trickier if there are children involved as there are additional costs to consider.  The obvious cost relates to private school fees which will still need to be paid.

This means that your children may have to change schools if your parents are unable to assist or choose not to assist.

If you are single & lose your ability to earn an income due to illness or injury the path is very similar.  Whether you are renting or paying off your home, chances are your only option may be to move back in with the folks!

Now moving back in with your parents for financial reasons may be OK for some.

If however the thought of once again having to listen or abide by your parents rules let alone lose your independence scares you to death, then it may be time to consider adequate personal insurance!

Life, trauma, TPD & income protection cover will provide valuable financial assistance at your time of need, so that you at least have the option to decide on what you wish to do.

For me the freedom & independence of both myself & family are invaluable.  With this in mind, my personal insurance policies always take priority over any other bills in our household!

Tom George
My role as a Life Risk Adviser involves educating, assisting and providing advice in the area of personal insurance. Follow me on Twitter | Linked In Profile

2 Comments on "Personal Insurance Or Move Back In With Your Parents …. Which Will It Be?"

  1. Liam Shorte says:

    Great article Tom. I deal with a lot of pre-retirees and the biggest risk to their financially comfortable retirement is those kids arriving home. So I suggest they fund some insurance for their children

    I have to admit I have learned so much about from your blog over the last few years. Keep up the good work.

    • Tom George Tom George says:

      Hi Liam,

      Thanks for your feedback, appreciate your comments and I’m glad some of my articles are of value to you. Likewise I have become better educated from some of your SMSF articles as well! Speak with you soon, Tom

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