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Brits should consider savings or critical illness cover

Date: Tue, 25 Apr 2006

Brits are being urged to make sure they have enough savings or critical illness cover to help protect them against financial problems if they become ill and are unable to work.

In particular, some workers could benefit by taking advantage of tax-free saving schemes to help boost their income if they are forced to spend a long period out of employment.

Under current schemes people are able to save up to £3,000 in an ISA before paying any tax and providers are keen to encourage people to start saving immediately rather than waiting for the end of the tax year.

David Cowdell of investment firm Fidelity International believes that setting up early saving investments makes sense for many people.

"In general it works out better to invest in an ISA at the beginning of the tax year, rather than waiting until the last moment," he said.

"People who invest in ISAs now could benefit from a 12-month tax free return whereas people who will leave it for the last minute are missing out potential market returns."

The money saved by not paying tax could also enable many Brits to purchase critical illness cover that could help to ensure they have a lump-cash sum if they develop a life-threatening condition.


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