Secure your future

Few things are more worrying to a married woman than the question: "What would happen to you and your children if your husband died tomorrow?"

Few things are more worrying to a married woman than the question: "What would happen to you and your children if your husband died tomorrow?"

The women who would suffer most are those who have given up jobs to raise families. Their husbands became the sole breadwinners, paid the bills and made the investments. When the husband dies, they are left at sea.

I urge women to involve themselves in long-term planning for the family and suggest that both spouses familiarise themselves with the family's finances.

You should both know where important documents such as the will, marriage contract, insurance policies and share certificates are located?

Many women do not know whether their husbands have a will, let alone what its contents are. A will should be taken out and read every two years to ensure it keeps pace with changing circumstances.

You should know what benefits you will you receive through your husband's company on his death. For example, does the family's medical benefit cease on his death? If not, what will it cost to maintain? Will his pension be paid to you? Will it be paid to you for the rest of your life?

A surviving wife should know how much money she will have and if she will be able to maintain her lifestyle.

If you invest R1million in a savings account at 8,5percent interest, it will provide a monthly income of R7083 before tax. Depending on your tax rate your net income could be as low as R4250 at the maximum tax rate. Many investment choices are available and you need to research the options.

It is important that you discuss this with your spouse when calculating future requirements. At an inflation rate of 8percent, your purchasing power will be halved in nine years.

l Bryan Hirsch is chief executive of Pioneer Financial Planning. Visit www.pioneer.co.za or e-mail help@pioneer.co.za for more information.

X