Do I need disability insurance ? - 4 questions for young professionals
Your most valuable asset isn’t your house, car or retirement account; it’s your ability to earn an income. Although many young people feel invincible or consider disabilities a problem reserved for their elder years, the Social Security Administration (SSA) reports that more than one in four of today’s 20-year-olds will become disabled for 90 days or more before the age of 67. Common disabilities affecting young adults include:
Injuries from accidents on & off the job
Pregnancy & complications due to pregnancy
Mental illness & depression
Back pain
Digestive disorders
Protecting your income with disability insurance (DI) can be key to obtaining financial security. Fortunately, premium costs are generally much lower for young adults. Still, we don’t recommend disability insurance for everyone, typically just over half our clients depending on their careers and personal situations. With that, here are a few questions to ask yourself:
Do you work in an physically demanding job? Whether you are hurt at work or in your spare time living an active Colorado lifestyle, if a moderate injury would prevent you from working, you should seriously consider getting disability coverage. If you find yourself behind a desk more often than you find yourself carrying babies out of a burning building, having DI may not be as critical. Although you still may want to have a look, as a librarian’s premiums will be much lower than a fire fighter’s premiums.
Do others rely on your income? If house payments, car payments, groceries, and other necessary bills wouldn’t get paid when you are out of a paycheck, you should get a comprehensive disability plan to cover yourself and your dependents.
Do you have a year of expenses already in savings? We’re not talking about Netflix subscriptions and fine dining tabs, but if you don’t have enough money in a dedicated account to cover a year’s bills, you are taking an unnecessary gamble.
Does your employer offer disability insurance coverage? Some employers provide short and/or long term disability for their employees which may be sufficient if you can survive on 50%-60% of your income. The downside is that the benefit is taxed when your employer is covering the premium compared to a stand alone plan. Having your own disability insurance policy also moves with you should you change employers which could save you money in the long run.
Oakway Financial LLC can help you protect your income and gain financial freedom. We have years of experience helping clients with disability insurance in Colorado. Our independent practice has an extensive network of disability insurance companies offering a wide range of plans and premiums to compare. Let us walk you through the ideal amount of coverage, benefit period and waiting period for your lifestyle and budget. Reach out to discuss your situation, ask questions, or compare quotes!