Do you believe that you’re unlikely to suffer a disability during your career. You’re not alone. According to the Council for Disability Awareness, American workers on average think they have only a 2 percent chance of suffering a disability during their career. The truth, though, is that the average worker has a 25 percent chance of missing work because of disability.1
Many people assume that disabilities only happen as a result of accidents. The truth is that disability can be caused by a broad range of medical issues. Diseases like cancer or heart disease could force you to leave work so you can pursue treatment. Chronic back or joint pain could grow in severity, limiting your ability to work.
If you had to leave your job because of physical ailments, how would your finances and your plans for the future be impacted? You might think you could rely on Social Security disability benefits. However, Social Security disability benefits are often capped and may not be sufficient to support your lifestyle.
Fortunately, there are steps you can take to protect yourself against the financial risk of disability. Below are three such steps you can implement today to minimize the disability threat:
Identify areas in your budget to quickly cut.
One of the best ways to protect yourself against disability or any financial threat is to develop a budget. Your budget can provide a clear view into your spending, which allows you to make informed buying decisions. After you build your budget, identify spending categories that could be cut quickly if you faced a financial crisis.
For example, you might be able to cut back on certain discretionary spending items, like dining out, vacations and shopping. You may consider cutting cable or moving to lower-cost cell phone plan. You could downsize your car or even your home. Identify these areas in advance so you can immediately implement changes if a disability should occur.
Keep credit lines available.
Debt can often be a threat in and of itself. However, open credit can be a very helpful resource if you face a disability or some other financial emergency. Although it may not be ideal to use debt to fund your lifestyle, pay medical expenses or cover other bills, it’s possible that debt could be your only option in some instances.
Identify a credit tool you have available that could serve strictly as an emergency resource. For example, you might have a line of credit on your house. If possible, keep that line open so you can use it in an emergency if you have no other resources available. Perhaps find a low-interest credit card you could open and save strictly for emergencies.
Consider buying disability insurance.
Disability insurance may be the most effective way to protect yourself against disability. A disability insurance policy pays you a monthly benefit if you are ever forced to leave work because of a physical ailment. The benefit acts as a replacement for your lost income. You likely insure your home, health, and maybe even your life. Why not also insure your ability to generate income?
There are short-term policies that pay benefits for several months, and there are long-term policies that could pay benefits potentially all the way up to age 65. Disability insurance policies have a wide range of adjustable features, so you can create a policy that meets your needs and fits into your budget.
Ready to develop your disability protection plan? Let’s talk about it. Contact us today at Trinity Financial. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
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16604 – 2017/4/25