You all probably have insurance on your auto, insurance on your house, you may even have insurance on your cell phone, but if you’ve spent your hard-earned income on insuring those parts of your life, are you also insuring that one thing that provides you with those items? Are you insuring your Income?
Ask anyone what their most valuable asset is, and you’re likely to hear answers like “My home” or “My 401K”, but the truth for most of us still in our working years is that our ability to earn an income is our most valuable asset. It makes sense then, if we’re willing to insure a car or house, shouldn’t we at least make sure we’re properly insuring the one thing that allows us to pay for that car and house, the thing that allows us to fund our retirement, and the thing that allows us to fund our Family’s lifestyle? This type of insurance is called Disability Insurance.
You may already have Disability Insurance through your employer, which is great if you understand that if your employer pays for the insurance the benefit payout to you, should you become sick or hurt so you can’t work, will be taxable. It will also be integrated with any Social Security Disability payment you might receive, which is a fancy way of saying, if SSDI gives you $15,000 a year, your employer provided plan will then reduce your benefit by $15,000 per year. Also, most plans cover you at 60% of your salary, that 60% is then taxed, so you’ll be getting far less actual income than when you were working. If you’re income is reliant on commissions and bonus income, it’s important understand how your employer plan treats that income, as most will not cover those types of income.
Income Protection plans can be confusing, and it’s best to seek a professional’s assistance when weighing your options. Please call us for a no-obligation review of your current situation. We’ll review your current employer provided benefits, what your income needs are, the ramifications of SSDI and taxes on your benefit, and explain it all to you in easy to understand language.
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