By protecting your income, it is also a means to conserve what a person earns at a particular time.  It means cutting out the extravagance and at the same time be able to enjoy a standard of living that is commensurate with what is being earned by the individual. 

1. Life Insurance 

One of the interesting factors with life insurance policies is that it takes into account future earning potential and aims to keep it protected. Thus a life insurance policy would ensure that future earning potential does not go waste, even during unfavorable situations in life. It is possible to be innovative in the use of life insurance by seeking out the best in premium and tenor of insurance. 

2. Buying bonds 

By purchasing bonds out of the surplus sums of money that is left over after meeting the expenses, it is possible to create a cushion towards protecting future earnings.  Most bonds offer some sort of tax protection and thus is ideal for tax planning as well. A future stream of income from the bonds would go a long way in keeping cash flows protected. 

3. Starting a Business

A good way to protect the current income is to start out an activity that would give an income stream in the future. A business venture is one such idea. Most governments encourage the start of new businesses as they tend to be major providers of employment and to some extent taxes. Thus there are opportunities for those seeking to protect their future earnings. 

4. Health savings account 

The health savings account does protect the future streams of income by taking care of medical expenses at a future date.  Most health savings plans do have tax benefits that help with further offsetting income. Thus sums of money that otherwise would have gone to the taxes are saved for use by the individual, while at the same time health issues are taken care of in the end. 

5. Taking advantage of the long term capital gains tax 

Most economies tax short term gains at a higher rate of tax than the long term investments. This is primarily done to discourage speculative activities and plan for a longer-term into the future. It would be possible to accord protection to earnings by planning in advance and hence taking advantage of the rates of taxes for the long term investor. 

6. Making use of retirement plans to the most extent  

It is common practice for most employers in the private sector to offer employees contributed retirement plans. Most such plans have a minimum level of contribution and a maximum level of contribution. This is to prevent the abuse of the system by people. The best method to protect incomes into the future is to max out the retirement plans to the fullest extent, thus providing for the most protection to income streams. 

7. Hedge investments 

These days there are a lot of people that use the capital markets to access investment avenues. A factor that most people are not aware of is how to hedge their investments as they grow.  It is possible to protect the downside risk to an investment as it grows by using proper steps called hedging of income. A good financial advisor like TradeRisk Insurance Australia would only be happy to guide clients in this aspect at all times. 

7. Guarding against critical illness 

Quite unlike ordinary flue or fever, a critical illness needs extra care to get over. Most instances would require hospitalization to effect complete recovery and they do not exactly come cheap at all. It would be in the interest of the middle-aged persons to take a critical illness cover for some of life’s spills. The insurance companies tend to give out a package plan that covers a number of illness at the same time. 

8. Family income plans 

Usually, in the case of life insurance, the beneficiary gets a single one-time payment of a sum of money. With the family income plans, the family gets to have an income stream that continues for a long time into the future. This is a better option in most cases than a single payment as often people who do get the single sum do not have the know-how to generate a steady income from the proceeds. 


One of the many ways incomes can be protected against an adverse occurrence is to use insurance coverage.  The present day insurance companies have specific plans that take care of certain contingencies as with some of the broader applications of insurance as well. People should be advised to consult an insurance advisor at the earliest and as soon as they start earning an income to learn how the earnings can be kept protected and preserved going into the future.  


Published by Daphenee Plaisir