Employment IQ: Why Most Working People Need Disability Insurance
How long could you financially survive without your paycheck?
Disability insurance is an important part of securing your dreams, lifestyle and income - for all types of occupations and industries.
Even substantial savings accounts run-out quickly if they are your only source of income. The risk of disability due to illness or injury is great and the consequences of not being prepared are severe. Why take the chance?
Jenny Smith
Jenny Smith is a 30-year-old accountant who earns 70,000 annually (including bonuses). She thought she had solid employer-provided coverage. However, when her financial consultant took a closer look, she discovered that if Jenny became disabled, she would face a 72 percent income shortfall after receiving benefits from her existing long-term disability policy. Jenny took her consultant’s advice and purchased a supplemental policy with a monthly benefit of $2,000 over and above the other plan. This was a smart move, because Jenny was recently diagnosed with Multiple Sclerosis. Although she isn’t disabled yet, she knows that coverage is there if and/or when she needs it.
Wayne Reynolds
Wayne Reynolds is a 50-year-old union electrician who supports a family of four with his $70,000 annual income. One day while working on his roof at home, Wayne fell off his ladder, severely injuring his spine. Wayne’s recovery spanned more than a year. All the while, he collected his employer-provided long-term disability benefit. While the benefit was nice, it didn’t come close to covering the family’s expenses. At the end of the year, Wayne Reynolds faced over $20,000 in credit card debt.
Don’t wait until it’s too late!
Get acquainted with the top five reasons why you need a disability insurance policy. Visit the education section of our site for articles, a disability insurance glossary of terms and an online disability IQ quiz. Or, get your instant disability insurance quote now!
Do any of these points describe you? If so, learn more about disability insurance today!
You have less than two years of income saved for emergency purposes (excluding retirement or college savings).
You are a primary or secondary breadwinner in your family.
Loved ones (children, parents, or others) rely on you for financial support.
Other non-earned income (such as interest or dividends) will not adequately cover your living expenses.
You have no one to rely on to support you in the event that you lose your earning power (for example, you’re divorced, single or do not have affluent and generous family members).
It would be difficult to achieve your long-term savings goals such as retirement if your paycheck stopped.
You would prefer not to downsize and change your lifestyle in the event of disability.
You can’t afford to live on 43% of your current gross pay (the amount provided by most long-term group disability plans after taxes)
*While Jenny Smith and Wayne Reynolds are fictional, their scenarios reflect the very real disability dilemmas faced by many working people every year.