Protection is designed to protect you, your family or your business financially from the effects of unexpected and unpleasant life events, for example illness or death. Protection polices tend to have a relatively long term and insure a person’s life or health, not their possessions.
General insurance protects your property or other interests against the financial impact of adverse events. Typically, the policies last for terms of a year or less. Products include buildings, contents, travel, car or commercial insurance.
A mortgage is a loan secured on property, representing a legal agreement with a bank, building society etc. It is usually used to purchase the property, but this is not required. If the borrower defaults on the loan the mortgage lender can repossess the property and sell it to get its money back.
The term pension refers to an income received in retirement; generally these are funded by people or their employers whilst they are still working. Registered pension schemes in the UK have special tax advantages to encourage people to save for their old age.
In its most basic form, investing is buying things such as shares or property with the aim of making gains higher than those achieved with savings. Investments tend to be taken out for the medium to long term and because of this aim to beat inflation. There are lots of different ways to invest and your adviser will recommend the most suitable for your needs.