Financial Emotional Intelligence - Illness

Financial Emotional Intelligence  - Illness


THE BIG 5 'D's

·        Death

·        Divorce

·     Disease

·        Disability

·        Debt

At the age of 40 you have lived  85% of your life. At age 10 you have lived more than 50% of your life... stop fighting the mathematics and start living.  - Adrian Gore.


1/1 + ½ + 1/3 + ¼ + 1/5 + 1/6 + 1/7 +1/8 + 1/9 + 1/10

10                                                   =              55%

1/1 + ½ + 1/3 + ¼ + 1/5 + 1/6 + 1/7 +.................... + 1/40

40                                                   =              85%




·        There  are far more social

         diseases around like

         cancer,  stroke and heart attack.   


·        These illnesses might not kill you the

         first time you get it.


·        Medication and treatment will 

         keep you alive, BUT financially

         it might ruin your retirement.


·      Biggest risk today is not death but

       rather an illness before the age of 65.



19th Century:


·        The average life expectancy was
          42. If you made it to age 42, from

         there on your life expectancy

         increased to 65.

         Should they have reached 65

         life expectancy then increased

         to 85.

         So there was in fact

         some old people around.  

         Just look at the

         portraits in the museums.



·       The biggest risk of death before

        the age of 42 was caused

        by illnesses or plagues for
        which there was NO treatment

        at the time.



When the doctors breaks the news to you that you have a life threatening illness, you will have a choice of either fighting the illness or you stare death in the eye. If the risk is 35% of being diagnosed with a Severe Illness between the age of 41- 50, then it would be wise to reduce your financial risk and insure yourself.


Financial Emotional IQ Check:

  • When it happens, it happens?

  • It will never happen to me.

  • My medical aid covers me for cancer.

  • I am healthy and fit.

Illness Cover was invented by Dr.Marius Barnard the not so famous brother of Dr.Chris Barnard who did the first heart transplant at Grootte Schuur Hospital in 1967. The reason for his invention of this financial product was because he witnessed first-hand how a divorced woman with terminal cancer had to work until she died in order to provide for her children.

Making financial provision will help you fight and survive a critical illness.

From age 42 - 48 you would have either paid off your bond or you are close to settling the bond. Think about this it is called compounding. The monthly return / growth that you earn on your pension fund is double compared to what your monthly contribution is towards your fund. Risking your capital by accessing your funds you will not only reduce capital but also not participate in the compounded growth.  If you started working after you finished your tertiary education you need to remember that it took you 23 years to create the above wealth. Don't risk your nest egg when it is too to prevent or reduce your financial risk. If you have very little other debts and you are not financially prepared you might also have to access costly debt. Who will pay this off if you are not there anymore?


When it happens it happens:

Be financially emotional smart, a disease like cancer affects your entire family. Emotionally it is a shock to you and your family. Make sure you are a member of a medical scheme. A medical scheme will cover your treatment and hospitalisation. If you are not a member you might have to dip into your savings or bond to cover the cost of treatment. Remember it took you years to build up your savings and pay off your bond, if you have to access that capital it will take you years to replace it again. A diagnoses at the age of 48 leaves  you with 15 years to get your capital back to what it was, then you have not allowed for growth or inflation. Retirement could be impossible?

  • Don't become a burden on your children.
  • The moment that you are diagnosed with a life threatening illness you are un-insurable.

My medical aid covers me for cancer and stroke etc.

This is true but you also have additional living expenses for example chemo and or radiation will be one of the prescribed treatments. Your treatment might not be at your closest hospital or clinic. Driving to and from the clinic and perhaps staying over are costs not covered by the medical aid. Sometimes it is necessary to appoint a driver to take the kids to school, take you to hospital or you might need a full time nurse to assist you when you go home after chemo.  The average cost for a 24 hour care taker is approximately R18 000 pm.


It will never happen to me and I am healthy and fit.


It could happen to anybody even the inventor of the insurance product.

Barnard was motivated by the financial hardship he saw his patients suffer after he had treated their critical illnesses to convince the South African insurance companies to introduce a new type of insurance to cover critical illnesses. Barnard argued that, as a medical doctor, he can repair a man physically, but only insurers can repair a patient's finances.[7] On 6 August 1983 the first critical illness insurance policy was launched.[8]

He is currently semi-retired, acting as a technical consultant for Scottish Widows.[9] Barnard has received many awards for his contributions to medicine and humanity, and was voted in the top 25 most influential people in the field of health insurance and protection.[10] Barnard has written two books one is his autobiography titled "Defining Moments" detailing his life story and his 2nd, "I Hate my Prostate" that details his battle with prostate cancer and also creates awareness of this cancer.