Your
employer provides good benefits – right? Maybe, maybe not. Let’s say you’re sick
or hurt and out of work for a year or so. How will you fare?
Well,
most employer-sponsored disability plans pay between to 60% to 66.67% of your
income if you are totally disabled. And that money is usually taxable. So you
might wind up with take-home pay that’s 30% – 40% less than when you were
working.
How would that impact you financially? Could you make it? If you are not sure, look
at your budget starting with fixed expenses like rent or mortgage, car payments,
student loans, child care, etc. Then add in non-optional but variable expenses
like utilities, phone, food, etc. Lastly, add in the rest of the items that you
spend money on to see what your minimum monthly expenses are. It is helpful to
have several month's credit card statements, check book registers, and bank
statements handy when doing this exercise. If your monthly expenses exceed your
disability benefits, then you should purchase a supplemental disability
insurance policy.
You
will probably not be able to purchase the entire 40% shortfall, but with a good
supplemental policy and a good group policy, you can sometimes get up to the
equivalent of about 70% – 80% of your after-tax income.
A
good insurance professional is the best person to help you fill in the gap.
“Local agents helping Local People”
360-414-8754 or 360-736-8090
