Why Income Protection?
We all want financial security and the ability to maintain our lifestyle. But sometimes life throws us a curveball. Having income protection (individual disability income insurance) can help ensure the unexpected doesn’t derail what you’ve worked for.
The value of your income
How would your life change if you were suddenly too sick or hurt to work, and couldn’t earn an income? How would you support your family? What would happen to your savings? To your retirement plans?
Nobody wants to think about it, but insuring your income could be the most important thing you ever do. Why? Because your ability to work and earn an income is by far your most valuable asset.
Take a look at how a lifetime of income compares to the typical value of a home or car:
- Car: $33,5601
- Home: $239,7002
- Income: $4,983,0003
How does this apply to your income?
Use the chart below to estimate what your earnings potential is between now and age 65. Then consider all the big and little things your income provides over that time frame—from housing, cars, and education to electronics, groceries, and vacations.
When a disability lasts a long time—for example, a chronic or recurring illness—the financial loss it creates can significantly affect your family’s lifestyle and future security.
That’s why individual disability income (DI) insurance is one of the most important components of any financial plan. Combined with retirement income protection, DI insurance can help replace lost income, maintain your retirement savings, and provide resources for returning to work when you’re ready.
But it’s about far more than just that. It’s about making a small investment today to ensure that you and your family are taken care of, even if the unexpected happens.
1 Average new car price, Kelley Blue Book, August 2015 (as seen on https://www.usatoday.com/story/money/cars/2015/05/04/new-car-transaction-price-3-kbb-kelley-blue-book/26690191/).
2 U.S. Existing Single-Family Home Sales Price, YCharts, https://ycharts.com/indicators/sales_price_of_existing_homes. As seen on 07/2016.
3 Projected cumulative income of a 35-year-old earning $6,250/month ($75,000 annually), assuming a 5% annual increase to age 65.
4 Commissioners Individual Disability Tables, CSO.