A big, unexpected household bill could put a spanner in your financial plan. Whether due to a broken boiler, car repairs, or a pricey pet bill, sometimes costs arise with little or no warning.
Worse still, if you suffer a serious illness or injury and be unable to work for an extended period, the loss of income could harm both your immediate and long-term financial security.
The good news is that there are steps you could take to help protect both your bank balance and your long-term financial wellbeing.
Here are three useful precautions you could take to shield your family and finances from unforeseen circumstances.
1. Top up and maintain a healthy emergency fund in an easy access savings account
An emergency – or rainy day – fund is a pot of cash you put aside to help cover unexpected costs.
While the size of an unexpected bill will vary, research suggests that the average bill for a family emergency is £355.30.
The amount you should hold in your emergency fund will depend on your family’s circumstances and needs. The “right” amount will usually be dictated by your income, the cost of regular monthly expenses, family commitments, and any other savings you may have on hand.
That said, one rule of thumb is to hold enough cash savings to cover between three and six months of normal spending in an accessible savings account.
If you’re a business owner, the sole breadwinner in the family, or you have a number of financial dependants, it may be wise to hold substantially more in reserve.
Royal London’s Financial Resilience Report 2026 found that 19% of UK adults have less than £100 in cash savings – almost unchanged since 2023.
Meanwhile, 35% of those with some cash savings would like to have more on hand.
If you’d like to discuss how we could support you in setting regular savings aside to build a comfortable financial cushion, please get in touch.
2. Protect your family’s finances from potential loss of income
Even the healthiest emergency fund wouldn’t last forever, so if you found yourself unable to work for several weeks or months, you may struggle to cover your everyday expenses.
We’re all guilty of burying our heads in the sand while insisting “it won’t happen to me”, but life doesn’t come with any such guarantee.
Even if you were receiving Statutory Sick Pay (SSP), paid at £123.25 a week in 2026/27, it may not be enough to cover your usual expenses and could force you (and your family) to adapt your lifestyles while you recover.
Plus, if you’re self-employed, you aren’t eligible for SSP, so being out of work could devastate your immediate and long-term financial situation.
However, having adequate income protection insurance could save you a huge amount of financial stress. In the event of a claim, the policy will make regular monthly payments, which will usually continue until you’re able to go back to work or retire.
This type of protection usually pays out a percentage of your usual salary, and is specifically designed to help you meet financial commitments if you become ill or involved in an accident.
Equally important, an income protection plan could give you access to rehabilitation services that might help you return to work sooner.
According to official figures from the ABI and Group Risk Development (GRiD), in 2025/26, income protection payments and additional health services helped 7,600 people to return to work.
3. Relieve financial concerns if you’re diagnosed with a critical illness
Macmillan, a charity providing support to people living with cancer and their families, estimates that almost 3.5 million people in the UK have some form of cancer – 3 million more than in 2020.
Affecting millions of people, cancer is just one of the critical illnesses that could lead to a claim on your critical illness cover.
Meanwhile, the ABI reports that individual critical illness claims paid out £1.25 billion in 2025 – marking the fifth consecutive year that payouts have exceeded £1 billion.
And almost 65% of all critical illness payments were for cancer.
While most critical illness policies cover cancer, they also include heart attacks, strokes, multiple sclerosis, Parkinson’s disease, major organ transplants, and kidney failure.
In monetary terms, the average critical illness payout in 2025 was £67,000, a sum which could make a significant impact if you or a family member were diagnosed with a critical condition.
Critical illness cover provides a lump sum if you’re diagnosed with serious illnesses that the policy covers. However, not all policies are the same and it’s vital to make sure you read the small print to ensure you’re paying for the cover you want.
We can help you understand which policy might be right for you and assist you in avoiding paying expensive premiums on insurance that isn’t what you expected.
Watch this video to hear a first-hand account of how critical illness cover helped one of our lovely clients when she needed it most, and how she heard the best news on Christmas Eve.
We are here to help ensure you have the protection you need to provide peace of mind
The type and level of protection that is most suited to you will depend on your circumstances. So, we’ll take a holistic view of your financial situation and family needs. In turn, we’ll help you decide what would provide you and your family with the most benefit and which policy might be right for you.
If you’d like to understand what protection might protect your family’s financial wellbeing, email contactme@kbafinancial.com or call us on 0161 260 2002.
Please note
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
Approved by The Openwork Partnership on 10/09/2026.