Disability Income
If you are self-employed, what have you done to protect your income, or what are you doing to attract and retain employees?
Almost every employee looks at employer benefits before accepting a job or will leave an employer because of benefits. As an employer you can offer group saving discount plans, so why not offer it?
The most important asset is “you” and your ability to earn an income while building a future nest egg to live on later in life.
What happens if you become completely unable to perform your work functions due to an illness or serious injury?
What risks does your policy cover?
You can rely on the government and Social Security, and they have two different groupings. Social Security Disability Income (SSDI) and Social Security Income (SSI), the option you will get depends on whether you have enough work credits built up or not.
SSI Supplemental Security Income pays benefits based on financial need and is for low-income individuals, is strictly based on their financial situation and impact of need.
SSDI utilizes your disability and the amount of work credits built up in your account. Social Security Disability Insurance pays benefits to you and certain members of your family if you are “insured,” meaning that you worked long enough and paid Social Security taxes.
In most cases you will not get enough to support yourself and will have to make radical changes.
Currently the maximum Social Security disability you can receive in 2021 is $3,148 per month. However, the average person will receive about $1,277 per month.
Investing in Disability Insurance is one of the most important items to plan for because if you are severely injured or experience a long-term illness unable to earn a living, this can be damaging to you financially. Imagine being unable to earn a living and rely on the US Government for your monthly income.
One way to structure a disability plan is to get a long-term disability plan when you are first starting out in your working career and when you have built up enough Social Security Credits, make changes based on needs.
For instance, start with a long-term disability plan and once you have built up your Social Security credits, review your Social Security file and switch to a short-term disability plan if the benefits are acceptable. This will lower your costs when switching to a short-term disability plan and provide for an income during the 5-month waiting period that is required under SSDI.
However, if you just want to protect your income and your future income, a long-disability plan can be a lifesaver. You can elect for a 30-day waiting period, or a much longer waiting period if you have enough savings set aside. These plans if injured or you become sick and unable to work would pay you a monthly income to age 65 or a set time frame, such as 2 years.
These 3 items will impact your premiums.
- The amount of income each month. Higher income = more premiums
- How long you wait for income to start, longer waiting periods = lower premiums.
- How long the income will pay you. Longer income streams = higher premiums.
What many people do is start off with something rather than nothing at all and increase the amounts as their income increases.
If you don’t have time today, ask us to remind you and we will email you a reminder in 2 days.
Why should you have a disability plan in place as soon as possible?
- Employee retention and attracting new employees.
- Income Loss is the number 1 reason for bankruptcy and poverty.
- 1 in 7 working age people have a movement disability impacting work and lifestyle.
- 5% of people become disabled each year.
- 1 in 4 people today (61 million) live with a disability.
- Less than 1% of disabilities were work related.
- The average Social Security Disability Check is only $700
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