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The Most Dangerous Phrase in Financial Planning
“It won’t happen to me.”
It’s a phrase most of us have used, often without even realising it. We say it about illness, accidents, loss of income, or life suddenly changing course. Not because we’re reckless, but because we’re human. We prefer optimism to uncertainty. Comfort to discomfort. Today to tomorrow.
When it comes to financial protection, very few people actively decide not to protect their family. What they usually do instead is delay. They assume there will be time later. That life will stay broadly on track. That the difficult conversations can wait.
The problem is that financial protection only works when it’s put in place before something happens, not after. And by the time many people realise they need it, their options are already limited.
In this article, Luke James explores the most common reasons people delay financial protection. Not to criticise, but to recognise patterns; the quiet assumptions that feel sensible in the moment, yet carry real risk over time.
Why We’re Wired to Think “It Won’t Happen to Me”
Our brains are excellent at helping us get through the day, but not always great at assessing long-term risk. Psychologists call this optimism bias: the tendency to believe that bad things are more likely to happen to other people than to us.
Add to that present bias - our focus on immediate needs over future problems - and it becomes clear why financial protection slips down the priority list. Thinking about illness, loss or disruption feels uncomfortable, abstract and unnecessary when everything seems fine.
Until it isn’t.
With that in mind, here are the most common beliefs that quietly delay protection — and why each one deserves a second look.
“Optimism bias isn’t ignorance — it’s human nature. We’re wired to assume tomorrow will look much like today. Financial planning exists to counter that instinct, turning hope into preparation and uncertainty into clarity.”
- Ellie Pemberton, Independent Financial Planner
1. “I’m Young and Healthy, I Don’t Need This Yet”
This is one of the most common assumptions, and one of the most misleading. Good health today often creates a sense of invincibility; a belief that protection is something for later life. But illness and injury don’t operate on a timetable, and they rarely come with warning.
Ironically, youth and good health are exactly when financial protection is easiest and most effective to arrange. Cover is typically more comprehensive, more affordable, and less restricted. Waiting doesn’t just postpone protection, it reduces choice.
Protection isn’t about expecting something to go wrong tomorrow. It’s about recognising that the best time to prepare is when nothing is wrong at all.
2. “I’ve Got Savings, I’d Be Fine”
Savings feel reassuring. Seeing money in the bank creates a sense of security, and for short-term shocks, that’s often justified. But many people underestimate how quickly savings can disappear when income stops.
A few months of illness, reduced working hours, or ongoing recovery costs can quietly drain even a healthy emergency fund. Savings that were meant for flexibility, opportunity or future plans end up propping up everyday living.
There’s a crucial difference between having savings and having income protection. One is finite; the other is designed to replace what you’ve lost. Relying on savings alone often means turning a temporary problem into a long-term setback.
“Savings provide breathing space, not long-term security. Without income protection, even healthy reserves can erode quickly. Planning isn’t about how long savings last. It’s about ensuring income continues when it matters most.”
- Keely Woods, Chartered Financial Planner
3. “The State Would Help Me If Something Happened”
It’s easy to assume there’s a safety net waiting in the background; that if the worst happened, the system would step in and keep life broadly on track. In reality, state support is designed to provide basic subsistence, not lifestyle continuity.
Statutory benefits are limited, tightly assessed, and often slow to access. They’re rarely enough to cover mortgages, family commitments, or the financial realities of modern life. Many people only discover this gap when they’re already under pressure.
State support can help you exist.
It won’t help you live as you planned.
4. “Insurance Never Pays Out Anyway”
This belief is surprisingly common, and largely outdated. It’s rooted in mistrust of the financial services industry, headline horror stories, and a general suspicion of smallprint. As a result, many people dismiss financial protection entirely without ever checking the facts.
In reality, the vast majority of protection claims are paid. Industry figures consistently show high payout rates across life insurance, income protection and critical illness cover. When claims aren’t paid, it’s usually because policies were misunderstood, incorrectly set up, or not reviewed as circumstances changed.
The real risk isn’t that protection won’t pay out; it’s that people never put it in place properly, or at all. Good advice exists precisely to make sure cover is appropriate, clear and reliable when it’s needed most.
“Most protection policies do exactly what they’re designed to do — when they’re set up properly. The real risk isn’t non-payment; it’s misunderstanding cover or never arranging it in the first place.”
- Melissa Henderson, Chartered Financial Planner
5. “It’s Too Expensive”
Cost is often cited as a reason for delay, yet most people who say this have never actually explored what protection would cost them. Instead, assumptions take over. Insurance is mentally filed under “luxury” or “nice to have”, rather than what it truly is: a financial safety net.
In many cases, basic protection is far more affordable than people expect, particularly when arranged earlier in life. And compared to the financial impact of losing income, facing illness, or leaving family exposed, the relative cost can feel small.
The more uncomfortable question is this: not “Can I afford protection?" but “Could my family afford life without it?”
6. “I’ll Sort It Out When Life Calms Down”
This is perhaps the most dangerous assumption of all. The idea that there will be a quieter moment - fewer responsibilities, more time, less pressure - is comforting. It’s also rarely true.
Life doesn’t slow down. Careers accelerate. Families grow. Financial commitments multiply. And the longer protection is delayed, the harder it becomes to prioritise... until a trigger forces the issue.
Protection is easiest to arrange when life is relatively stable. Once health changes, stress increases, or circumstances shift, options can narrow or disappear altogether. Waiting for the “right time” often means waiting too long.
7. “My Partner Would Cope”
This belief is usually rooted in love and confidence rather than logic. We want to believe the people closest to us are strong, capable and resilient. And they often are. But coping emotionally and coping financially are two very different things.
The reality is that the loss of a spouse, illness or sudden responsibility places enormous strain on even the most capable partner. Managing grief, children, work and finances simultaneously is a heavy burden. Financial protection isn’t about doubting your partner’s strength, it’s about removing one major source of pressure at an already difficult time.
Protection is, in many ways, an act of kindness to those you love most.
“Protection planning is often framed as a financial decision, but at its heart it’s emotional. Removing financial pressure allows families to focus on healing, not on difficult money decisions at the hardest possible time.”
- Steve Rowe, Chartered Financial Planner
8. “My Employer Covers Me”
Workplace benefits can be valuable, but they are frequently misunderstood. Life cover, income protection or critical illness benefits provided by an employer are often limited in scope, temporary in nature, and tied directly to your job.
Change roles, take time out, start a business or retire, and that cover may disappear entirely. Even while in place, it may not be enough to meet your family’s needs or reflect your true income.
Relying solely on employer benefits assumes your circumstances, and your employment, will never change. For many people, that’s an assumption that doesn’t hold for long.
9. “Thinking About This Feels Morbid”
Avoidance is human. Nobody enjoys contemplating illness, incapacity or death. These topics are uncomfortable, emotional and easy to postpone, especially when life feels busy and full.
But discomfort doesn’t equal danger. In fact, avoiding these conversations often increases anxiety over time. Planning doesn’t invite bad outcomes; it simply removes uncertainty.
Those who put protection in place often describe the opposite of what they expected: relief. Once it’s done, the worry fades into the background, replaced by the quiet reassurance that loved ones would be supported, whatever happens.
10. “Nothing Bad Has Happened So Far”
This belief is a classic example of survivorship bias; the idea that because things have gone well until now, they’ll continue to do so. Past good fortune can quietly turn into a false sense of security.
But luck isn’t a strategy. Financial protection exists precisely because life doesn’t announce disruptions in advance. It’s about preparing for when, not if, circumstances change.
The absence of past problems doesn’t reduce future risk, it simply means you haven’t needed protection yet.
“It Won’t Happen to Me”... Until It Does
Most people don’t delay financial protection because they’re careless. They delay because they’re optimistic, busy, and focused on today. The phrase “it won’t happen to me” feels reassuring... until life proves otherwise.
The real risk isn’t getting protection wrong. It’s never putting it in place at all.
Financial protection isn’t about expecting the worst or living in fear. It’s about removing panic from difficult moments, protecting the people you love, and ensuring that unexpected events don’t undo years of hard work.
Awareness is the turning point. Once these common denials are recognised for what they are - human shortcuts, not facts - taking action becomes far easier.
And often, the most loving decision isn’t to hope everything works out…
It’s to make sure it will.
A Thoughtful Next Step…
If any of these points felt familiar, it doesn’t mean you’ve done anything wrong. Most people delay protection for understandable reasons, until they have the space to pause and reflect.
If you’d value a quiet conversation to explore what protection might look like for you and your family, our advisers are here to help you understand your options clearly and without pressure.
Sometimes, peace of mind starts with a single, unhurried discussion. Feel free to contact us when the time feels right.
Disclaimer: This article does not constitute financial advice. We recommend that you speak to a qualified financial planner for advice tailored to your individual circumstances and goals. Financial markets may go up or down, and you are not guaranteed a return on your investment. Past performance is not necessarily a guide to future performance.
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