While the insurance industry is growing in the Philippines, there is still a big market to conquer. The last survey conducted by the insurance commission was in 2017 and it showed that only 16.8% of Filipinos have life insurance coverage. Why is that? It seems that the most common answer is fear. People are afraid of financial planning because of different reasons. Can you find your reason below? Maybe this is already your sign to start or restart your financial journey with the right planning.

Reasons Why People Are Afraid of Financial Planning

Here are some of the common reasons why people are afraid of financial planning or why they haven’t started it doing it yet.

Fear of Uncertainties

Maybe it is superstition, but there are people who do not want to talk about death or sickness. It may be the fear of uncertainty or the fear of death. Or it could be fearing that whatever you are preparing for will come to pass. But the truth of the matter is, death is the great equalizer. Up to this day, despite the healthy practices and the anti-aging products we consumed, no one has discovered the secret to immortality. It is better to be prepared than you leave your family in a state of bereavement as well as a financial dilemma.

FOMO and YOLO

Setting aside some money either monthly, quarterly, semi-annually, or annually for life insurance seems a bit too exaggerated for some. They feel like it’s a lot to sacrifice their present wants, like the vacation or designer bag they desire, in order to afford life insurance coverage. Some even feel that life insurance takes away their freedom to spend and enjoy in the present and only the people who are left when they die will reap the benefits.

• Read: YOLO, FOMO and Your Finances

Ms. Valerie Lagarde-Amora, Cluster Head, Sun Life Philippines, said that there is a need to change the mindset and perspectives of Filipinos. “Insurance allows us to be happier for a longer time. It is a matter of showing them the right perspective about financial planning.”

She also underscored that “we invest in life insurance because someone needs to continue living. If something happens, your family benefits.” But if nothing happens to the insured, “you can enjoy the income from your life insurance policy. Our salary may retire with us, but our expenses will continue.” It is still a win-win situation.

Fear of Costs

A lot of people, especially employees, still think that insurance is very expensive and is only for the affluent. They feel that it is too costly to allocate a monthly budget for insurance besides their regular expenses.

Fear of Talking to an Advisor

According to Ms. Andrea de Guzman, Financial Advisor, Sun Life Philippines, people are afraid of talking to financial advisors mostly because of the way we are raised. We have that mindset that money or finances is something personal. Salaries, investments, and savings are not openly talked about like it’s taboo.

Moreover, people also fear the horror stories that they have heard in the past. They fear that they might encounter unscrupulous insurance agents who are just out to earn a commission from them but do not really know how to advise properly.

Restart Your Financial Journey

There are different stages in life and in each stage, you can still start or restart your financial journey with the right financial planning methods. Which stage are you in right now?

Getting started. Are you fresh out of college or just starting a career? At this point, you are still building confidence and gaining some independence. What are your financial resources?

Moving up. You have enjoyed the rewards of your career and have settled down. It’s either you are starting to build a family or already have young kids. Your family is your priority.

Preparing ahead. The kids are growing up and suddenly, you find yourself in middle age. You are now focused on nurturing health as well as building wealth. Health and wealth should both go well together.

Leaving a legacy. Your children are all grown up and have families of their own. You and your spouse want to ensure your happy and well-provided golden years without relying on your adult children’s dole-outs.

Talking to a Financial Advisor

Each stage in life has its own needs as well as challenges. Your income as well as your expenses vary depending on what stage you are in. You can also factor in inflation.

This is where talking to a financial advisor about insurance comes in. Nowadays, life insurance policies are designed so that if something happens to you (the breadwinner), your family benefits from the coverage of the policy. Meanwhile, if nothing unfortunate happens, then you can enjoy the income from your life insurance policy for a quality life in the later years.

Talking to a qualified financial advisor will help you navigate through your expenses as well as determine the ways how best you can invest your money in life insurance. Ms. De Guzman says, “A financial advisor can tailor-fit a plan for you.” Based on your current income and needs, as well as your income potential, they should be able to recommend different products that will give you the most benefit according to your financial goals.

“We should look at financial planning with excitement and not with fear,” Ms. De Guzman closes.

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