If you are among those fortunate people who have good jobs, especially in the most productive years of your life, then you may want to consider this extra layer of financial protection. I’m not here to sell you anything… I just want to educate you.
Because, as a gainfully employed individual, it makes sense to minimize the danger of losing your ability to earn an income. Especially when government meddling, central bank policy, or international interest-rate wars are not the cause.
Whether you or someone you care about is in the wealth-building stage of life, where working and producing an income is a vital function, you’ll want to read this email about the little-known and little-discussed financial product that secures your salary.
Disability Insurance: Here’s What You Need to Know
Suffering from a disability causes severe financial hardship. It’s also more common than you probably believe.
Entrepreneurs and hard-working people often forget they are their OWN gold-laying-goose. Your wealth and virtually everything you own is a result of your ability to work industriously. If you lost your investments or your business, you could pick yourself up and build it again. But if you become disabled and can’t work, even if you want to, your and your family’s entire life could be turned upside down.
Suffering a Long-Term Disability Is Not Uncommon
and an Accident ISN’T Generally the Cause
The majority of income earners believe they have less than a 2 percent chance of suffering a long-term disability. According to DisabilityCanHappen.org, the odds are closer to 30 percent!
Car accidents, ski accidents, and other accidents don’t tend to cause long-lasting disabilities. Studies suggest illness causes the vast majority of disabilities. A 2010 Long-Term Disability Claims Review revealed accidents caused just 10% of disabilities. The other 90% are caused by a slew of illnesses such as:
What’s worse, as opposed to broken bones caused by an accident, illnesses like the ones mentioned above can last weeks, months, years, and even a lifetime.
The Government Won’t Be There to Help You
According to the Council for Disability Awareness, only 5% of U.S. workers (8.3 million) received Social Security Disability (SSDI) benefits by the end of March 2011.
The Free Market Has Developed a Solution
Many insurance companies are willing to protect your ability to work and earn with an Income Disability Insurance policy. Simply stated, if you become disabled and not able to work the insurance company pays your salary.
You’ll need to speak with your agent to get specifics, but here are a few basics to help familiarize you to this sort of financial insurance product.
A Surprising Bonus Tip If You Own a Permanent Life Insurance Policy
If your life insurance plan builds cash value, you could add an optional Waiver of Premium. In a nutshell, if you become disabled, the insurance company pays your premium payments. All the while, your cash value continues to accumulate and you have total access to the growing funds through a withdrawal or policy loan. And if it’s set up correctly, these funds could be available to you tax-free.
And If You Own a Business, Have Partners, or Key Employees…
Many companies are aware of the importance to cover their key employees, such as executives and business owners, with a life insurance policy. But often, income disability insurance is overlooked.
For someone in their working years, suffering a disability is much more common than experiencing a premature death. Yet, the result to the company is the same – the loss of that important and productive individual. Disability insurance can help cover the financial loss and keep the company stable until a replacement is found. In the case of business partners, disability (as well as life insurance) can be used to fund a buyout – making these products important estate planning tools as well.
While you’re building your wealth and protecting your spending power through hard asset investments, don’t let your financial rug get pulled from under you and lose your ability to work and earn. Speak to your insurance agent at your next review and consider disability insurance to help protect your financial life.