How to be financially ready for unexpected injury or illness

Estimated reading time
 5 min

Learn all about

• Ways to budget for the unexpected, like taking control of your savings and reducing expenses.
• Government support available for people experiencing injury and illness.
• Ways ANZ can support you in times of vulnerability.

When we’re fighting fit, the last thing on our minds is planning for a significant injury or illness. But the best time to plan for the unexpected is, well, before it happens!

Being financially ready in the event of a life-changing illness or injury can make all the difference, especially if you need to take an extended break from work to focus on your health and wellbeing. Here are our top tips for being financially prepared for anything life throws at you.

5 things you might want to consider, to help prepare your finances for life-changing injury or illness

If life’s humming along smoothly without a pothole in sight, it makes sense that planning for an unknown future where things are bumpier can feel a tiny bit pointless. But now is the time to create space for the unexpected, especially when it comes to your finances.

Here are 5 things you might want to research and consider whether they are right for you. Remember, always do your research: look at the fees and changes, eligibility criteria and T&Cs, in order to work out what is best for your circumstances!

1. Income protection insurance: Generally, this type of insurance pays up to a certain amount of pre-disability income, for a period of time, if you acquire a disability caused by serious illness or injury and you are unable to work.

2. Total and permanent disability (TPD) insurance - another type of insurance that can protect you if you acquire a total and permanent disability because of injury or illness and you are unable to work again. What makes TPD different from income protection is that it generally pays you out a lump sum, while income protection replaces a percentage of your income for a period of time. TPD is typically tied to superannuation, so check if your fund offers this insurance and what conditions apply.

3. A separate savings account for your emergency fund to cover about three months’ worth of bills, repayments and daily expenses.

4. Set up a form of passive income, if you can, while you’re healthy and able. This can include anything from investing in property or the stock market to creating a side hustle that works for you, such as developing worksheets, frameworks or even online courses. Doing the groundwork now could mean you can earn a steady stream of income later in life if you’re out of work.

5. Pay off as much debt as you can when you’re financially stable. This can help alleviate any pain points down the track and give you peace of mind while juggling a newly acquired injury or illness. Also, commit to taking out loans you can comfortably cover if you need to take a sudden break from earning a consistent income.

  Brain hack

Hyperbolic discounting is where we choose instant rewards over the ones that come later in life. While there might be short-term benefits to skimping on these things – like booking a holiday rather than paying off debt – it’s important to think bigger. You know, things like keeping your household running while you’re out of work, covering medical bills and making sure you’re financially flexible.

Tap into government support

You can access financial support from the government for chronic illness and acquired injury.

JobSeeker

If you’re injured or ill and can’t do your usual work for a short period, you might be eligible for the JobSeeker Payment. This allows you to focus on your recovery so you can return to work fit and healthy.

Concession cards

There are different concession and health care cards you might be eligible for if your income is reduced because of an injury or illness. The Low-income Health Care Card is for people who meet an income test, while the Pensioner Concession Card is for people who earn a certain payment (like JobSeeker) or are over a certain age.

Compulsory third party (CTP) insurance

In Australia, all motorists need to take out compulsory third party (CTP) insurance. This type of insurance is required when you pay your car’s registration. Even though CTP is different from state-to-state, the general idea is that it provides compensation for anyone injured in a car accident. The cover is inclusive of treatment, medical care, and income.

  Hot tip:

Don’t forget to see what the rules around extended sick (or carer’s) leave. are at your workplace. Having total clarity on what you may be entitled to, can go a long way.

How can ANZ support you?

Most banks will have different ways to help you if you happen to experience a life-changing illness or injury. At ANZ, our Customer Connect Team will work with you to find the right support, so you can navigate big changes in your life with a little more ease.

The first step is to reach out either via our website, or by calling 1800 252 845 to share your current circumstances. From there, the Customer Connect Team might:

• Place a temporary hold on your current loan repayments until your situation changes or you have financial supports in place.
• Waive interest on your loans for a period of time.

If you’re struggling to meet your ANZ financial obligations, like monthly loan repayment, or you think your injury or illness will mean you’re unable to meet them, you can apply for assistance due to financial difficulty. Both types of supports will be on a case-by-case basis to ensure you’re getting the right financial support. But if you can’t access these supports, then we have a list of services that can help you during difficult times and financial hardship. You can also get mental health support at any time through Beyond Blue. Their support is entirely confidential – meaning none of the information you share will be shared with us.

Read more about becoming a carer