Do you protect your most valuable asset?

What is your most valuable asset?

Your house? Your car? Your ridiculous good looks?

What about your ability to earn an income?

Huh? That's random.

But when you think about it, and as gross as it is, most things we do or have in life involves shelling out cash. Either to purchase or maintain. Think about your goals... Saving for your first house? Want to start your own business one day, or even just live a comfortable life... It's going to cost money.

Where is that money going to come from? Well unless you're Richard Branson, James Packer, or the randomly lucky Lara Bingle, the reality for most of us is that we have to get up in the morning and go to work.

If you think about it, assuming you're not a bludger, there'll only be two times in your life that you won't work for an extended period of time. The first is retirement - you know, when you do the gardening in Speedo's. The second, would be if you got quite sick or had an accident and couldn't work - possibly by getting hit by a parked car?

If someone asked you... which is more important to you right now? - your income in retirement or your income while your working now - what would you say?

Well unless your 64.5 and shopping for Speedo's you're going to say my money right now thanks!

So we dont work in retirement (yes Sean, that's the definition). How will we afford to live then? I mean i need my spray tans, my itunes - and new roller blades...??? Well fortunately the Goverment is making sure you set aside 9% of your income now to protect that income once you're finished.

So what percentage of your income are you setting aside to protect your income while you work?

If you're like most of my very wise clients, you'd be happy to set aside about 3% of your income, to protect that income no matter what. That's what it cost the average Joe to get income protection insurance.

Would you?

Remember, everything your planning to do in life is going to require it.

Insurance is a dirty word. Like stiffy or slug. Or Simon. But why do we insure our cars as a given? Cause it would suuuck if someone stole it bro!

I pay over a thousand bucks a year to insure my crappy Hyundai from getting stolen (its worth about $15,000 - o.n.o - buy it mate! Please!) Yet I'm more than twice as likely to get injured or sick enough to stop me from working for 12 months than I am getting my car stolen - and income protection insurance costs me about the same (I've protected myself for $80,000 a year).

Wait a minute... For about the same premium I've protected something worth more than 5 times my car!?

And if I couldn't ever go back to work (that car was hard) the policy will keep paying me till I'm 65!

So what is your most valuable asset? Well if your 30 and earn, for example, $60,000 per annum... you'll earn over $2 million by the time your 65.

Worth protecting?

If you want to know how to get income protection insurance, speak to a good financial advisor and they'll hook you up.

If not - I guess you're just lucky Lara Bingle.