Are You Protecting Your Most Precious Financial Resource?
by Ande Frazier
July 16, 2019 .2 min read
While most people may recognize the importance of having at least some type of life insurance, many people forget about or are completely unaware of another type of insurance that’s just as important — disability insurance.
Did you know that you stand a far greater risk of becoming disabled than the possibility of suffering almost any other kind of loss?
Disability insurance protects against the loss of your most precious financial resource — your earning power.
A frightening scenario
Think about what you would do if you became disabled and:
Your income declined or stopped while your debts increased
Your savings and investments had to be drained to cover the gap
Your retirement plans went unfunded, creating even more problems later in life
Your family’s standard of living dropped abruptly
Your wealth accumulation plans had to be put on hold
The probability of disability is much higher than that of a home fire, death, even a severe auto accident.
And the most common causes include many of the sicknesses, illnesses, and injuries that we all face at some time in our lives.
Protect yourself with individual disability insurance
Individual disability insurance is designed to replace enough of your after-tax income to take care of the essentials should you become disabled.
So, when considering disability insurance, it's important to ask yourself the following questions:
How much? - More specifically, how much income would you need to meet your essential monthly obligations?
How long? - Most policies will pay a monthly benefit for a time period you choose, typically 1, 3, or 5 years, to age 65, or lifetime.
How soon? - Most policies come with a waiting period before benefits become payable. Again, you select the waiting period based on your needs and what you can afford. Typical waiting periods are 30, 60, 90, 180 days, or one year.
Most disability policies will only replace up to 60% of your lost income. However, benefits are generally tax-free.
Don’t let death, an accident, or an illness wipe out everything you’ve worked so hard to build. Protect yourself and your family.
Ande has made it her mission to break down the emotional, behavioral and societal barriers that stand between women and strong financial foundations.
She's widely recognized as a driving force in the financial community, having risen to the top of the primarily male-dominated insurance world as the former head of a multi-million-dollar fintech company and a VP at Penn Mutual.
Ande launched myWorth to inspire a financial awakening among women who are eager to take control of their financial journeys. Her first book will be published in October 2019.