WHAT’S YOUR MOST VALUABLE ASSET?

It’s always interesting to hear the answers people give when asked to name their most valuable asset. Unsurprisingly, age and lifestyle play key roles in the variety of answers given.

For instance:

  • An 18-year-old Uni student may well consider his Ipod to be his greatest asset.
  • A 28-year-old nurse may tell you her car is her greatest asset.
  • A 38-year-old executive might opt for his family home and investments.
  • A 48-year-old might consider her successful business as her greatest asset.
  • A 58-year-old may have eyes for nothing else except his racing yacht.
  • A 68-year-old may well cite family and good health as valuable assets.

 
Apart from the last answer, the rest can really be categorised as ‘valued’ as opposed to ‘valuable’ because in every case your most ‘valuable’ asset is – stand up and take a bow – yourself!

Think about it. From youth through to retirement, your ability to earn an income largely dictates how comfortable you and your family will be. Getting back to the question of your most valuable asset, try putting a price on your head and you may be in for a surprise.

John Smith (not his real name), for example, is 30 years old and currently earns $60,000 a year. By the time John retires at the age of 67 (thank you Mr Rudd), he would have earned $2.2 million. This simplistic calculation doesn’t even factor in any pay rise, promotion or even cost-of-living indexing. So essentially John Smith’s life is worth $2.2 million as of his 30th birthday.

Things change in life, as we have seen by the answers above. People marry, have children, surround themselves with more material goods and investments to make their families’ lives easier. Someone has to foot the bill. Gone are the days of free rent, meals and laundry with Mum and Dad. It’s all up to lucky you.

The big hitch, however, is that if something happens to you, the breadwinner, that results in death or incapacity to work, it’s likely to result in great hardship for the family. Who will pay the mortgage? What about the private school education you planned for the kids? Sure, Centrelink might pick up some of the tab but is that what you would really want for your family?

Chances are you wouldn’t dream of not insuring your house or your car, so why would you not insure your most valuable asset – you?

There’s never a better time than the present to see a licensed Financial Planner about life insurance, income protection insurance and trauma insurance. You’ll be surprised how little it costs, about the same price as your daily cappuccino for a lifetime’s worth of peace of mind.

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