This week we thought we would share with you the happy story of Annabella.* It is the kind of story we love as financial planners.
Annabella is in her mid-30s. About ten years ago, she first developed symptoms of a serious mental illness. Without going into too much detail, this illness had a pervasive effect on most parts of Annabella’s life. Her life was very difficult for a time there. She has been extremely brave in her recovery.
Fortunately, before she became ill, Annabella had spent several years working in various jobs. Often, she worked these jobs while studying. The effect of this was that Annabella was a member of a couple of superannuation funds.
Annabella’s illness has left her unable to work for the rest of her life. This is where a number of Australia’s safety nets kick in – and this is also why Annabella’s story is ultimately a happy one. Firstly, Annabella now receives a Disability Support Pension. This is a regular fortnightly Centrelink payment that does not require Annabella to try to look for work each fortnight (as the unemployment benefit would).
Secondly, Annabella has been able to access some funding from the National Disability Insurance Scheme (NDIS). This lets her receive support and some allied health assistance that she needs. These supports help Annabella go out into the community each week, which she was unable to do before she received her NDIS funding.
Finally, and this is the part that really warms our heart as financial advisers, Annabella has made a successful claim for an insurance benefit through her superannuation. The claim was for ‘TPD’ (total and permanent disability) and the insurance policy was taken out automatically when Annabella was working earlier in her life. That is, she did not actually decide to take out this insurance policy – it was automatically established for her when she joined her super fund.
Annabella received a lump sum payment. At the moment, most of it is held in her super fund and she draws a relatively small amount each year from that fund to assist with her costs of living. The remaining benefits are invested and Annabella is drawing less than the annual return on the investment – meaning that she is also increasing her wealth to a small extent each year.
The financial security from this safety net greatly improves Annabella’s quality of life. She can focus on maintaining her health, free of the stress that insecure income or being forced to work would create. This lets her fulfil her roles within her family and with her wider community.
This is exactly what TPD insurance is intended for. TPD insures us in case something happens that prevents us earning an income by working. Many people have TPD insurance that they do not know about, and, sadly, many people experience events such as Annabella did when she developed her illness. So, if you or someone you know has been affected by illness or injury, please get in touch. It may well be that you, too, can make a claim on an insurance policy you might not even know you have. And that claim can be life-changing.
* Annabella’s name has been changed and the image we have used is not of Annabella. Obviously, we want to maintain her privacy.