Disability Insurance

According to the Social Security Administration, 25%, or one in four adults will be disabled for one year or longer before reaching the age of 65. What would you do if you were disabled? Who would pay your bills?

Some folks have disability income insurance through their employer. If your employer pays for your disability policy, your benefit will be taxable. If you purchase an individual plan on your own, the benefit is tax-exempt.

Disability policies traditionally provide a benefit equal to two-thirds of someone’s W-2 or Schedule C income. Options available with disability insurance policies include:

• a waiting period—you self-insure for a period of time before benefits become available. The most common waiting periods are 60 and 90 days
  
• the length of time you collect a benefit—two years, five years or to age 65 or age 67
  

You depend upon your earnings to fund your retirement plan, pay your mortgage, put food on the table and gas in your vehicle. Without a paycheck, life becomes difficult. Securing the right disability insurance contract will give you a safety net that can make life a little easier, financially anyway, if you become unable to work