When my husband and I went to set up our first will, the family lawyer told us an interesting and scary fact. As a young to middle-aged individual, you are significantly more likely to become disabled than die. So, there we were making arrangements for the unlikely death of one of us, and actually gaining a valuable lesson. While wills and life insurance are important, statistics tell us that disability insurance is where we should put our most dollars.
If you have a decent emergency savings, the most important next step is to invest in long term disability. This can even be true for those who are stay-at-home parents as their childcare work is equivalent to dollars saved. If a stay-at-home parent becomes disabled, the family will have to find someone to take over her/his roles.
For those who do earn income, disability insurance is an absolute necessity. Many employers offer it, but some don’t. When you look into disability insurance be sure to pay for the maximum percent of your salary possible. This higher percentage is especially significant for long term disability. While it may cost you more upfront, the benefit you receive at a difficult time could be well worth it.
Often it is an accident or serious illness that puts many families into poverty. One year of rehabilitation can cost you your life savings. Typically disability insurance costs are low, especially compared to other insurances like home, health or car. This is especially true if your employer offers the insurance and covers some of the premium costs.
Short term disability is usually less important, as it only lasts 3 months. Most families could live off their savings during that time. But long term disabilities can last years or even a lifetime. Don’t traumatize yourself even more during a time that is already difficult. Look into long term disability insurance today.
For more insurance information, check out the insurance blog!