Broker Check

The Importance of Disability Insurance

June 15, 2020

Without receiving your paycheck, how long would you be able to make your mortgage/rent payment, buy groceries or pay your bills without feeling tight about money? If you are like most people, it wouldn't be long. 7 in 10 working Americans could not make it a month before financial difficulties arise, and one in four would have problems almost immediately.

That is where disability insurance comes in, think of it as insurance for your paycheck. It ensures that if you are unable to work because of illness or injury, you will continue to receive an income until you are able to return to work.

You insure your home, car and other valuable possessions, so why wouldn’t you also protect what pays for all those things—your paycheck.

Simply put, if you have a job, you probably should look into disability insurance. The possibility of a disabling illness or injury may seem slight, but statistics say otherwise.

You actually have a three in 10 chance of suffering a disability that keeps you out of work for 90 days or longer at some point during your working career, and most disabilities are caused by illnesses, not accidents.

Most of us have some type of personal debt, such as a mortgage or credit card bills. Would you be able to maintain your standard of living if you were too ill or injured to work for a long time? A disabling injury or illness could lead to medical bills, modifications to your car or home or other unforeseen costs that can be expensive.

You have to think long term in this situation. How much do you earn in a year and what would that be over a lifetime. A 26-year-old worker who makes $50,000 a year and suffers a permanent disability could lose up to $3.5 million in future earnings.

A disability can change everything in the blink of an eye. If you work in a high-risk field and you don’t currently have disability insurance through your job, consider collecting a few quotes from insurance providers. You might be surprised at how little it costs to protect your income and lifestyle.

For all these reasons, almost anyone who works—whether they’re single, married, with children or without—should consider disability insurance.

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG, LLC, is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright 2020 FMG Suite.