Disability Insurance is an Investment in Your Future

Family with financial peace of mind. Protect Your Income, Open Enrollment 2023

Disability Insurance is an Investment in Your Future

November 9, 2023
By The Council for Disability Awareness Disability, Disability Insurance, Employee Benefits, Facts, Featured, Finance, Financial Planning, Personal Finance, Plan, Protect Your Income, Uncategorized

Alexandra Ginieres Chief Marketing Officer, MGIS The ability to earn an income is what funds your lifestyle, your family, and ultimately, your future. Reliable income is the foundation of a sound financial plan; without it, financial consequences can be devastating and long-lasting. Luckily, we .. more »

Alexandra Ginieres
Chief Marketing Officer, MGIS

The ability to earn an income is what funds your lifestyle, your family, and ultimately, your future. Reliable income is the foundation of a sound financial plan; without it, financial consequences can be devastating and long-lasting. Luckily, we have the means to ensure a more stable future and promote financial wellness through income protection.

Disability income insurance helps you better prepare for the unexpected and meet life’s challenges. It replaces a portion of your income if you become too sick or injured to work. Mortgage, credit cards, student loans, college savings, retirement contributions – all financial responsibilities funded by our income.

The chances of disability are real – and so are the financial risks

Disability happens more often than you might think. The reality is that one in four 20-year-olds will experience a disability before retirement. That’s why having a solid financial plan in place that includes income protection is key.

While the chances of disability are real, so are the financial repercussions that come along with a loss of income. According to the Fed’s 2022 Economic Well-Being of U.S. Households survey, 37% of Americans lack enough money to cover a $400 emergency expense, up from 32% in 2021. With the average long-term disability lasting almost three years, savings may not be enough and a lack of income protection can put you at risk for debt or even worse, bankruptcy. Proper planning is critical to avoid these financial consequences.

Moreover, as of 2022, 58% of debts recorded in collections were for a medical bill, according to the Consumer Financial Protection Bureau. All the more reason to ensure that the right coverage is in place to protect your livelihood and your future.

Your most valuable asset over a lifetime

Most of us think of income in terms of a monthly paycheck. But your income is your most valuable asset, and when viewed over an entire working life, the cumulative amount is remarkable. Consider this: an individual with an annual income at age 30 of $100,000 will have total cumulative earnings of $6,046,208.18 (assuming a 3% annual increase and retirement at age 70). We must think beyond the monthly amount and look well into the future to ensure proper planning.

While many of us focus on the cost of disability insurance (it’s not always inexpensive) and that “it won’t happen to me,” the reality is that the insurance premium is a small price to pay to ensure protection of those lifetime earnings. Isn’t that worth the investment?

In fact, loss of income due to a disability goes beyond just the inability to cover basic needs and expenses. Many of us contribute to retirement plans and build college savings for our children. For those without proper income protection in place, many will tap into long-term vehicles such as savings or investments (401k or IRAs) intended for future needs. Also, when you become disabled and can no longer work, your retirement contributions will stop, and your investment accounts will no longer grow. Your long-term goals are too valuable to risk in the event of a disability.

The solution: holistic coverage across group and individual benefits

So how do we invest in our future? Most employers offer group disability, which is a great foundation for protection. However, especially for high earners, this type of coverage may not be enough and could leave an income gap. Group long-term disability generally covers about 60 percent of your income – again, a solid foundation – but additional coverage may be needed in order to better meet financial obligations and debts.

The solution to manage this income gap is individual disability insurance. By combining a group policy with additional individual protection, you create a more robust income protection strategy that allows you access to a larger benefit amount to cover everyday expenses. The key is to make sure you are tapping into all options, both employer-sponsored and those available individually from an insurance carrier.

Your future self is counting on you

When looking to strengthen or build your income protection strategy, work with an experienced financial professional or insurance broker to help build a plan that will work best for you and your family. A financial professional will assess your financial goals, analyze existing coverage amounts, and help you build a plan that considers future needs and long-term goals. The idea is to find a combination of group and individual coverage that will help you maintain your lifestyle in the event of a disability and allow you to focus on your recovery (not your finances).

Simply put, disability insurance is worth the investment – for you, your family, and your future.

To learn more about income protection, visit RealityCheckup.info, which is part of a CDA consumer outreach program to help working adults understand the importance of having alternate sources of income for times when they cannot work due to illness, injury, or pregnancy.

Mature couple comforting each other. Protect Your Income, Open Enrollment 2023

The Story that Cemented my Conviction

October 31, 2023
By The Council for Disability Awareness Disability, Disability Causes, Disability Insurance, Facts, Featured, Financial Planning, Insurance, Long Term Disability, Personal Finance, Personal Stories, Plan, Protect Your Income, Uncategorized

My entire career, I’ve been told that “stories sell, not features.” This is so true because nobody cares about the products themselves, people only care about what a product can do for them. To know what something can do for you, you must put yourself in a scenario where you see yourself benefiting from it. This always reminded me of the movie Tommy Boy, when Chris Farley’s character iconically and vividly explained what would happen if you bought “cheap brake pads.”

I often use stories to help clients understand the value of the tools they need to support their financial future. I also use stories to explain complex product features that help clients make decisions on whether it’s worth paying more for something (since cost is a function of value). These stories are sometimes personal stories from my own family, or stories of people I’ve worked with over the years. I also use stories I’ve heard from others that really stuck with me. But there is one story that has cemented my conviction in the importance of having disability income insurance and why I should never be afraid to push harder.

The Desperate Doctor

A psychiatrist’s wife had reached out after finding me online and reading an article I had written a few years earlier. She wanted to talk about getting more disability insurance for her husband as soon as possible, which always sends red flags because whenever someone is urgently looking for insurance, they are probably ready to start using it.

After a brief discussion with the couple, I learned that between group, association, and individual coverage, the doctor had a total of $30,000 per month of protection. The wife also worked as a pharmacist and made a good income as well. So why were they so desperate to get more? I soon learned that the doctor had a progressive form of Parkinson’s at the age of 42.

What stood out to me most about this discussion was that they were willing to pay any amount of money to get more coverage. “Is there anything we can do? Is there any amount of money we can pay to get more?” I could hear the fear in their voices which surprised me because $30K of monthly benefit sounds like a lot. But to the mother and father of two young children with a pending debilitating disease, they were willing to empty their bank accounts to get more security. Not only was the father going to lose his income, but he was also going to lose his body and his ability to function. The pharmacist wife was going to have to quit her job as well to stay home and help with his care, causing them to lose two incomes.

I talked them through all their policies and how each would pay in various scenarios as the disease would progress from a partial disability to a total disability, to a catastrophic disability. In that moment, they didn’t care about the definitions, the financial ratings of the company, or nuances with the various policy riders. All that mattered was they didn’t have enough, and they couldn’t get any more. Knowing how the policies worked and when they could expect payment in various scenarios gave them some comfort, but in the end, I couldn’t do anything for them.

Before his diagnosis, he admitted that he fought his advisors. He only bought what he felt he needed and justified his decisions at every turn. Phrases like “I’m never going to need this” and “we don’t need that much; we can always cut back on what we spend,” were his way of convincing his prior advisors to only sell him what he was willing to buy. He didn’t have a reason to buy more because he couldn’t see a scenario where he and his family couldn’t live on $30,000 a month. Now, he was willing to do whatever it took to make sure he had as much as he could get. The reality of a life that would be vastly different from what he and his wife had planned for and worked so hard to create scared him.

In hindsight, he wished his advisors had pushed him harder, though he wasn’t sure he would have listened and was thankful for what he had. So, what did he have? He had life insurance policies which we looked to see if he had a waiver of premium and possibly still had time to convert his term insurance into permanent so he could max fund premiums for a period before letting the waiver of premium take over. But his policy didn’t have the waiver of premium.

He also had disability income insurance policies and after we reviewed them, we found there was no catastrophic benefit to help with at home care and there were no retirement protection benefits to replace his ability to save for retirement. It’s important to understand when benefits begin to pay out on any policy purchased. His association policy would pay, 1) full benefits at the time he becomes totally disabled and is unable to work and/or 2) partial benefits if he can work but on a limited basis such as fewer hours or performing limited duties, but he must experience a total disability first. Since his condition will slowly progress and eventually turn into a total disability, he does not have coverage in place to help with the loss of income he’ll experience before he becomes totally disabled. There was so much more that could’ve been done but wasn’t.

I use this story a lot, especially when someone tells me “I don’t need that much.” Every financial dream and every well laid out plan are formed on the basis that our income will always be there – the one input that impacts every possible output and scenario. Protecting the income should be the priority and should be addressed with conviction and urgency.

Although this couple was never a client of mine, I’m glad I met them. They reinforced my beliefs and strengthened my fervor to ensure none of my clients will ever experience what they are experiencing right now. I never want to tell someone “I’m sorry, I could have prevented this if only I pushed a little harder.”

To learn more about income protection, visit RealityCheckup.info, which is part of a CDA consumer outreach program to help working adults understand the importance of having alternate sources of income for times when they cannot work due to illness, injury, or pregnancy.

Protect Your Income, Open Enrollment 2023

Is Disability Income Insurance Worth It?

October 25, 2023
By The Council for Disability Awareness Disability, Disability Insurance, Facts, Personal Finance, Protect Your Income, Uncategorized

This article originally appeared on the MassMutual blog site You insure your most valuable assets like your home, your car and your life. Most people would agree that they’re worth protection; however, disability income (DI) insurance is something people tend to be less certain about. They’re not .. more »

This article originally appeared on the MassMutual blog site

You insure your most valuable assets like your home, your car and your life. Most people would agree that they’re worth protection; however, disability income (DI) insurance is something people tend to be less certain about. They’re not sure if they really need it, or if it’s worth the cost. So, is it? There’s no cut-and-dried answer, but there are some strong arguments to be made in favor of DI.

What are the chances you’ll need it?

When you think about the kind of disability that could keep you from working, usually the first thing that comes to mind is a car accident or other catastrophic injury — in other words, something that could happen, but most likely won’t.

In reality, the most common cause of disability is illness, not accidents or injuries. (Take our disability income insurance quiz)

Arthritis, back pain, neurological problems, and cardiovascular illnesses are all more common than injuries when it comes to disability claims.¹

You might be thinking that there’s always savings. If you have enough

money in the bank to cover your living expenses for more than a month or two, you’re in better shape than the large majority of Americans. If you don’t, you’d need to consider another option. (Calculator: How much DI insurance do I need?)

Also keep in mind that the average disability lasts a lot longer than the one-to-two month range. Most people’s savings would run out long before that.

Can I afford disability insurance?

Disability income insurance helps replace a portion of your income if you are too sick or injured to work. Many people have DI insurance through their employer. Such coverage, however, can fall short in both the amount and type of coverage your household may need. (Related: 6 ways group disability income insurance may fall short)

Individual disability income insurance plans can ensure you have protection that’s right for your circumstances. But when you’re already paying for other kinds of insurance — home, auto, life, etc. — it’s hard to think about buying more. But a good way to frame it is what disability insurance costs versus what the benefit would be if you used it.

Here’s a hypothetical: Say a 30-year-old man, taking home $56,250 a year buys a disability insurance policy that costs him $929 per year. (By comparison he could be spending $985 a year on a daily coffee, assuming an average price of $2.70.)

If he becomes totally disabled, after a 90-day waiting period he could receive $4,050 a month over 12 months, replacing about 86 percent of his pre-disability, after-tax income — and hopefully allowing him to keep up his coffee habit.

There are, of course, some limitations and eligibility requirements for DI. So, in the end, it’s a matter of whether you feel like the benefit you could receive outweighs the cost of premiums and the uncertainty that comes with not having any coverage at all. Costs and benefits vary from policy to policy.

Protecting your most valuable asset

With any luck, you’ll never have to deal with a disability that keeps you from being able to work. But it’s a good idea to have a plan in place, so that if you ever did become disabled you could still cover your expenses and provide for the people who count on you.

_{1 MedicineNet, “Leading Causes of Disability,” April 20, 2022.}

_{2 Social Security Administration, “The Faces and Facts of Disability/Facts.”}

_{Insurance products issued by Massachusetts Mutual Life Insurance Company (MassMutual) (Springfield, MA 01111-0001) and its subsidiaries, C.M. Life Insurance Company and MML Bay State Life Insurance Company (Enfield, CT 06082).}

_{Policies have exclusions and limitations. For costs and complete details of coverage call your agent or MassMutual at 1-800-272-2216 for a referral to an agent.}

_{The information provided is not written or intended as specific tax or legal advice. MassMutual, its employees and representatives are not authorized to give tax or legal advice. You are encouraged to seek advice from your own tax or legal counsel. Opinions expressed by those interviewed are their own and do not necessarily represent the views of Massachusetts Mutual Life Insurance Company.}

patient and doctor consulting about prostate cancer, a personal story

How My Experiences as a Patient Helped Me Become a Better Physician and Deepened My Understanding of the Impact Illness has on the Whole Person

October 19, 2023
By The Council for Disability Awareness Anxiety, Disability, Disability Insurance, Health and Wellness, Mental Health, Personal Finance, Personal Stories, Uncategorized

By Dr. Jonathan Torres, Medical Director, UnitedHealthcare Specialty Benefits Like many other people, I was going through life busy raising children, working and making time for hobbies and travel when possible. I had completed medical school, residency training and served as a physician in the .. more »

By Dr. Jonathan Torres, Medical Director, UnitedHealthcare Specialty Benefits

Like many other people, I was going through life busy raising children, working and making time for hobbies and travel when possible. I had completed medical school, residency training and served as a physician in the U.S. Air Force. During those more than 27 years as a practicing occupational medicine physician, I had the privilege to treat thousands of patients, many of whom were experiencing significant health issues. When I was in the exam room face-to-face with my patients, I thought I knew most of them reasonably well and had a good sense of what they might be going through.

That all changed shortly after turning 50, when I was diagnosed with a potentially serious medical condition. I had a stark realization: I didn’t know as much as I thought I did about what my patients were going through. As a physician and now a patient, I became immediately focused on finding the best doctors and exploring the myriad treatment options, each with their own risks and complications. I lost sleep reviewing research data on my condition and, honestly, became overwhelmed with all of it.

This new illness consumed my time, energy, and focus – not to mention all that goes with the many medical visits and coordinating treatments amid family and work commitments. I muddled through a trying six months of “not fun” consultations and diagnostic testing. I found myself overwhelmed trying to find the right doctors and decide on a course of treatment, despite differing medical opinions and recommendations. It wasn’t until later I realized how much the stress and anxiety associated with my illness had affected me.

I eventually connected with the right physicians for me and my condition and opted for surgery. While my recovery featured more downs than ups, I was relieved to eventually be on the other side of this life-threatening issue. Although I would never wish any of this on anyone, the experience has made me a better physician and person. It’s given me a new appreciation and understanding for the challenges people face when navigating the health system.

Accepting Support from Others

My life changed the moment I received the call from my doctor telling me I I had prostate cancer. Initially I felt very alone with my diagnosis, but thankfully I have a strong and loving family that helped support me. As I started sharing this news with close friends, the sense of support became immeasurable. Opening up about this condition made me stronger – as if I were carrying a lighter load. Words cannot express the gratitude and appreciation I felt when people asked, “How are you doing?” Also, my dog, Mason, helped too. While he couldn’t understand what was going on with me, somehow it felt like he just knew.

Mental Health and Physical Health go Hand in Hand

Whole-person health is just that: mind and body connected and in balance. Through my diagnosis and recovery, I learned that we should not underestimate the impact physical conditions have on one’s mental health and well-being – and vice versa.

Throughout my life I have always thought of myself as someone who manages stress reasonably well. However, I learned there can be increasing levels of health-related stress, interrupted restorative sleep, and anxiety about the unknowns that can be subtle and unrecognized at first and escalate significantly if unchecked. At its peak, I also started to develop physical symptoms that were unrelated to any specific cause or underlying medical condition. It was not until I completed additional testing that I realized these were entirely due to the degree of psychological stress I was experiencing.

Disability and Supplemental Health Plans can Help Address Coverage Gaps and Decrease Financial Stress when Serious Health Events Occur

Most people, me included, often spend most of our time during open enrollment comparing health plan options as part of our employer-sponsored benefits. Now that I have seen first-hand the ways in which a significant health event can have unexpected and often unplanned financial impacts, I’m prioritizing financial safeguards to help cover associated and expected financial gaps. That includes electing additional coverage such as disability, hospital indemnity and critical illness plans.

When I was overwhelmed with my health condition and out of work after surgery, I learned the importance of having short-term disability (STD) coverage. This type of plan enabled me to experience less financial stress and instead focus on my recovery. I did not have critical illness coverage at that time (I do now) and learned that in situations like this, this additional benefit can help make up the difference between STD coverage and regular pay (about 60%) and other financial gaps, including to help cover out-of-pocket expenses such as health plan deductibles or coinsurance requirements.

Looking Back and Looking Forward

As time marches on and I look back to that chapter of my life, there is an overall realization that this health event has made me a better person and physician. I try to be mindful of that lesson every day. Here are a few thoughts I keep in mind about this experience that may be beneficial to consider:

How I felt when asked “How are you doing?” And how asking other this question may help them, too.
The importance of recognizing our own stress levels and ability to cope, while leaning on others for support when needed.
Significant health events have multidimensional effects on us and, whenever possible, it helps to view health and illness holistically.
Especially now that I have seen first-hand the ways in which a significant health event has unexpected and often unplanned monetary impacts, it gives me reassurance to have financial safeguards in place, including disability and critical illness coverage.
Relying on key individuals and professionals at specific points in my health journey not only helped me move forward, but also now serves as an ongoing source of gratitude and appreciation.

Higher Level Perspectives and Broader Impact

Given my many years in clinical practice, my experience as a patient with my own health journey, and now more recently with my work at UnitedHealthcare (where the following are prioritized), I understand the value and importance of:

Focusing on whole-person health as a fundamental starting point for overall well-being.
Developing approaches to improve whole-person health rather than focusing primarily on risk management.
Expanding resources through Employee Assistance Programs (EAP) to include more no-cost virtual or in-person visits.
Simplifying the consumer experience by leveraging technology and connecting specialty and medical benefits to make navigating the health system more intuitive and less burdensome.
Recognizing that a significant health condition can have financial impacts on the individual and this can affect decisions regarding healthcare engagement.
Improving access to health advocacy resources to help people bridge potential gaps within our healthcare systems.

_{To learn more about income protection, visit RealityCheckup.info, which is part of a CDA consumer outreach program to help working adults understand the importance of having alternate sources of income for times when they cannot work due to illness, injury, or pregnancy.}

_{References on the bidirectional associations between physical and mental health conditions}

_{1. Association Between Depression and Physical Conditions Requiring Hospitalization. Frank, P., Batty, D., Pentti, J., et. Al. JAMA Psychiatry. Published online May 3, 2023. https://jamanetwork.com/journals/jamapsychiatry/fullarticle/2804269?guestAccessKey=5c50825e-9542-4cef-ac8a-1a85a9de46b4&utm_source=For_The_Media&utm_medium=referral&utm_campaign=ftm_links&utm_content=tfl&utm_term=050323.}

_{2. Pre-Existing and New-Onset Depression and Anxiety Among Workers With Injury or Illness Work Leaves. Gaspar, F., Wizner, K., Schott, F., et. al. J Occup Environ Med. 2020 Oct; 62(10): e567–e572. Published online 2020 Aug 5. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7537737/.}

Protect Your Paycheck With The Combined Benefit of Social Security Disability Insurance and Ticket to Work-Protect Your Income Campaign

Protecting Your Paycheck With The Combined Benefit of Social Security Disability Insurance and Ticket to Work

October 17, 2023
By Steve Perrigo Disability, Disability Insurance, Protect Your Income, Social Security Disability Income, SSDI, Uncategorized

By Steve Perrigo, Allsup Protecting your paycheck is more important than ever for most working Americans. The higher cost of everything from gas to groceries, plus high interest rates, make it a challenge to stay within household budgets. In these uncertain times, it’s important .. more »

By Steve Perrigo, Allsup

Protecting your paycheck is more important than ever for most working Americans. The higher cost of everything from gas to groceries, plus high interest rates, make it a challenge to stay within household budgets. In these uncertain times, it’s important to know the federal protections that are in place should you ever need them.

Nearly 160 million U.S. workers may be unaware of an important protection to their earning power. The combined benefit of Social Security Disability Insurance (SSDI) and the Ticket to Work Program supports individuals when they cannot work due to illness or injury, and offers significant incentives to return to the workforce when the time is right.

The Social Security Administration (SSA) oversees SSDI. FICA taxes are the insurance premium you pay to enroll in the program. Last year, $160.7 billion in net payroll tax contributions for DI were collected.

Social Security Disability Insurance

Despite paying into the program, many people don’t know they have earned SSDI with their FICA taxes. The program goes beyond monthly cash payments. SSDI unlocks a whole host of other benefits that can make a significant difference for those dealing with chronic illnesses or disabilities.

These include:

Monthly income. The average 2023 benefit is $1,483, and it maxes out at $3,627.
Medicare coverage. Medical and prescription drug coverage begin 24 months after SSDI cash benefits start.
Protected Social Security retirement benefits. Approval for SSDI triggers a Social Security earnings record freeze that can result in a higher retirement income.
Dependent benefits. SSDI approval can result in benefits for children under 18, adding up to 50% more to an individual monthly payment.
Annual cost-of-living adjustments. The COLA is evaluated annually and may raise your monthly income.

The Ticket to Work Program

Even fewer people know about the Ticket to Work program (TTW). According to a recent report from the SSA, almost one third of SSDI beneficiaries were unaware that they could keep their SSDI benefits and return to work.

TTW is an extension of SSDI. All individuals who receive SSDI are automatically eligible for TTW. It’s a free program for U.S. workers with disabilities that offers a safe path to try working again after their medical condition stabilizes. The Ticket to Work program offers substantial protections including:

Earn any amount. During the first year of the program, you can make as much money as you want and protect your full SSDI benefits.
No continuing disability reviews. Avoid Social Security’s disability reviews and the possible benefits termination that may result from a review.
Keep Medicare. While working, you can continue receiving Medicare for more than 7 years.
Benefits reinstatement. If you need to stop working any time within 9 years, your SSDI benefits restart.
It costs nothing. Social Security funds this program, so beneficiaries work with Employment Networks (ENs) at no personal cost. ENs help people with all aspects of returning to work.

There are many unfounded beliefs about SSDI. Some people think SSDI is a fund they’re paying into and, by taking SSDI, they will reduce the money they’ll receive in the future. This isn’t true. It is a federal insurance program and FICA taxes are the premium you pay to be covered. It’s actually better for an individual to take SSDI if they can’t work, because the program protects their future retirement income.

The combined protection of SSDI and TTW covers American workers at a vulnerable time. The income and other benefits it provides are a safety net when you can’t be sure how you’ll provide for your family. Ticket to Work completes the program by providing a path back to work when it’s medically advisable. The Ticket program has returned thousands of former workers to their livelihoods, or, with the help of ENs, found them a new career. You owe it to yourself and your family to be knowledgeable about protecting your paycheck with this federal insurance policy that you’ve paid into.

Position Individual Disability Income Insurance Effectively

November 10, 2022
By Scott McCarthy Disability, Disability Insurance, Employee Benefits, Personal Finance, Protect Your Income, Rock Enroll, Uncategorized

Scott McCarthy, Regional Vice President, Sales & Distribution, Ameritas Life Insurance Corp. Managing and understanding risk is not a strength for many people. It’s also why financial professionals need to be effective at helping clients make changes that address long-term financial needs. Changing the conversation .. more »

Scott McCarthy, Regional Vice President, Sales & Distribution, Ameritas Life Insurance Corp.

Managing and understanding risk is not a strength for many people. It’s also why financial professionals need to be effective at helping clients make changes that address long-term financial needs.

Changing the conversation

In discussions with colleagues, I frequently comment on the need to change our client conversations. I feel that we need to recognize there is a gap between what people do or think based on their feelings versus what people do or think when operating based on critical thinking. The following examples can help us understand what we’re up against and how that can help us have better conversations.

Example one

There’s an anxiety and fear for many people when taking commercial flights. Whether the flight is short or long, there is a deep concern about safety. Many statistics show travel by car on public roads is far more dangerous both in terms of injury and death, yet the fear of flying is greater.

Example two

In the financial world, if we asked working individuals with a retirement account or investments for a basic axiom of investing, the phrase “buy low, sell high” would likely be a popular response. It is understood that it’s best to take advantage of dips in the market to buy assets when prices are at their lowest and acquire a profit by selling when prices are at their peak. But time and time again, when faced with rising markets the population’s appetite to get in on the gains means buying high. Market drops are met with selloffs instead of investments as people try to get out before prices hit bottom. Common knowledge goes out the window.

Approaching clients about insurance products can be some of the most challenging conversations. The main enemy is inertia. Often these conversations are addressed with a client who does not feel a need for life or disability insurance partially because they’ve lived without it up until now and, in most cases, without giving a single thought about either product.

The only way to effectively move clients from the “it’s all good” mindset is to disrupt their understanding and then educate. There are different ways to go about this, but the process begins with making the client aware that you can help them address problems they haven’t yet thought of – problems that could disrupt their future and the future of their family. With life insurance, it’s a little easier since the idea of having life insurance when you start a family has moved into the realm of common knowledge for many.

I know many financial professionals who effectively have conversations positioning life insurance as a valuable piece of a financial plan. As someone who spends most of their time working with disability insurance, I find this much like addressing someone’s fear of flying while not dealing with the risks of getting in a car for the morning commute. The chances of individuals passing away during their working years are much less than their chances of suffering health issues which can interrupt their ability to work.

Seeing the need before you need it

Clients need to understand a health issue can disrupt their ability to work because once it happens, it’s too late to address it with an effective solution. A key to attaining individual disability income insurance is being healthy enough to qualify. This syncs with our second example. If individuals feel fantastic and their health is at its peak, it can appear to be the worst time to pursue coverage for their health. It’s like asking them to “sell high” in a sense. On the flip side, there have been many times I’ve had to inform producers their clients were ineligible for coverage due to an ongoing health issue. When their health is at its worst, the conversation about protection is easy. I think this understanding is important as we prepare to talk about how disability insurance can help improve clients’ futures.

The education we share with healthy satisfied clients when addressing a need that doesn’t feel urgent should be focused on the risk they carry and the benefit they gain. Many clients are not thinking an unexpected change in their health could interrupt their ability to work and negatively impact the future they were planning for.

Many Americans today rely on self-funded retirement plans like 401(k), 403(b) or other tax advantaged investments to build money for the future. Once the short-term savings are gone, the next set of funds available during an income disruption is going to be the retirement fund(s). Clients are not likely thinking of this but need to be aware of this before discussing the solution an individual disability income policy can help provide. Individual disability income insurance is unparalleled as an efficient way to provide a stream of income to help maintain a current lifestyle without having to deplete assets.

The tipping point

The ability to protect the retirement assets in an unexpected challenging time is a potential tipping point and well-informed clients are likely to take the next step to work with a financial professional to build a plan that includes a disability income insurance policy, if they want to shield their retirement. There will still be those willing to bet on their continued good health but all we can do is continue to educate and bring awareness at future client meetings or annual reviews.

It’s tough to ask people to go against their gut instincts without an appeal to reason. Taking the time to inform and educate clients so they can see the problem and want to fix it is a good approach to help them move past their first instinct. From there, a strategy can be crafted and put in place.

I had a glass paperweight that I kept on my desk but have since lost over the years. The message etched on it frequently comes to mind and summarizes in simple terms my message above, “seek first to understand then to be understood.”

How to “Enroll” in Social Security Disability Insurance

October 27, 2022
By Steve Perrigo Disability, Disability Insurance, Living with Disability, Rock Enroll, Social Security Disability Income, Uncategorized

By Steve Perrigo Editor’s Note: When most of us think about “open enrollment” for benefits through our employers, we rarely—if ever—think about benefits we passively pay into through our payroll FICA taxes, such as Social Security Disability Insurance. Steve Perrigo from CDA member company, .. more »

By Steve Perrigo

Editor’s Note: When most of us think about “open enrollment” for benefits through our employers, we rarely—if ever—think about benefits we passively pay into through our payroll FICA taxes, such as Social Security Disability Insurance. Steve Perrigo from CDA member company, Allsup, writes an easy-to-read post on this important benefit.

October is the kick-off for healthcare benefits enrollment for many U.S. workers. While you don’t technically “enroll” in Social Security Disability Insurance (SSDI), you participate in a process of becoming covered because of your work—specifically the earnings you receive year by year.

SSDI is an insurance policy that you pay into via your FICA taxes, and your benefit amount and insured status is based on all the years you worked. More than 159 million American workers have access to this federal disability insurance. The Social Security Administration (SSA) oversees SSDI, and they follow a stringent disability review process for applicants.

If you experience a life-changing disability—and have to stop working – you should apply. The income and benefits you receive (that you’ve paid for) can be vital for your financial future, whether you return to work or reach Social Security retirement age.

The agency looks at medical and work history to determine who qualifies for SSDI benefits. Generally, to qualify for SSDI, you must:

- - - - Be between 21 and full retirement age.
        
        Have worked at least five of the last 10 years and paid FICA taxes during that time.
        
        Be unable to work in any capacity because of a mental or physical impairment that’s expected to last at least 12 months or be terminal.
        
        Be under the care of a healthcare professional who can confirm severity of medical condition(s).

How Your Social Security Disability Benefits Are Calculated

The SSA determines your benefit amount based on your lifetime average earnings before you became unable to work. Your payment amount is calculated using your “covered earnings.” This refers to money you earned at jobs where you paid FICA taxes as an employee or being self-employed.

Your SSDI monthly benefit is based on your average covered earnings over a period of time, which is referred to as your average indexed monthly earnings (AIME). The SSA uses these amounts in a formula to determine your primary insurance amount (PIA). This is the basic amount used to establish your benefit.

The maximum benefit you can receive in 2022 is $3,345 per month, up from $3,148 in 2021–a 6 percent increase. The SSA offers benefits calculators you can use to obtain an estimate of your monthly benefits. This year, the average SSDI payment for an individual is $1,358 while the average monthly benefit for a recipient with a spouse and children is $2,383.

The Process To “Enroll” For SSDI: Quarters of Coverage

The Social Security Administration uses the term “quarters of coverage” to explain how you become enrolled in SSDI as a covered worker. In 2022, the amount of earnings required for a quarter of coverage (QC) is $1,510. The terms “quarter of coverage,” “Social Security credit,” and simply “credit” are all used interchangeably. A QC is the basic unit that determines whether you are insured under the Social Security program. It is not possible to earn more than four QCs in one year, no matter how much money you make.

Every year the amount of earnings necessary for credits increases slightly as average earnings levels go up. The credits you earned stay on your Social Security record, even if you change jobs or have no earnings for a while.

You need at least 10 years of work (or 40 QCs) to qualify for Social Security disability benefits. The SSA bases the amount of your benefit on your highest 35 years of earnings.

How To Claim SSDI

To receive Social Security Disability Insurance benefits, you must apply to the SSA. The initial application and the detailed information you provide are critical to getting benefits without an appeal. You can complete the application on your own, or have a disability representative assist with the complexities of proving your claim.

The SSA reviews applications to determine whether you qualify for monthly Social Security benefit payments. This sounds simple, but you must have medical evidence and documentation to prove you meet the legal definition of disabled, and carefully complete the forms because it’s possible to make simple mistakes that could lead to a denial.

As American workers search for answers to keep themselves and their families protected in uncertain times, it’s important to recognize SSDI for the increasingly valuable income and security it offers. It’s a significant protection available to millions of employees who simply have been unaware that they’re already enrolled.

Social Security Disability Benefits Include Protections for Returning to Work

October 6, 2022
By Steve Perrigo Disability, Disability Insurance, Inclusion Ignites Ideas, Social Security Disability Income, SSDI, Uncategorized

By Steve Perrigo Editor’s Note: When you’re approved for Social Security Disability Income benefits by the Social Security Administration, you receive monthly financial payments (upon approval) and Medicare (after 24 months). A secondary benefit of SSDI is the ability to participate in the Ticket to .. more »

By Steve Perrigo

Editor’s Note: When you’re approved for Social Security Disability Income benefits by the Social Security Administration, you receive monthly financial payments (upon approval) and Medicare (after 24 months). A secondary benefit of SSDI is the ability to participate in the Ticket to Work program that allows beneficiaries of SSDI to return to work while protecting their SSDI and Medicare benefits.

In this post-COVID era, many Americans are well aware they could be the casualty of a life-threatening illness, injury or disability that could remove them from the workforce. As a result, American workers are becoming familiar with protections inherent to their work that can help them sustain themselves and their families.

Benefit For Workers: Ticket To Work Program

All individuals currently receiving SSDI benefits are eligible for and encouraged to use the Ticket to Work program. This is a free and voluntary program that provides individuals with disabilities with a range of services provided by Employment Networks (EN). Case managers at ENs assist individuals in the process of preparing to return to work. Services can include interview preparation, résumé writing, and encouragement in overcoming the barriers to finding employment once they are ready.

Bypassing Valuable Benefits: SSDI And Ticket To Work

While more than 156 million Americans are insured for this benefit, the SSDI program is frequently overlooked for its incredible value. This is true especially among individuals who’ve had a solid working career and want to return to their profession or field after a medical issue. “Many of our clients have significant work experience and have gotten sidelined by a medical issue,” said LeighAnn Jarry, Assistant Vice President of Allsup Employment Services. “Now they’ve recovered enough and are ready to get back into the workforce.”

A medical condition and its work-disrupting effects are not necessarily permanent. For instance, a number of individuals who experience a stroke – depending on the severity – eventually recover. They can stabilize through rehabilitation and return to work. This means workers with a health issue lasting 12 months (and longer) can receive important monthly income and then support with their return to work when they reach medical stability. That’s the core mission of the SSA’s Ticket to Work program.

The little-known TTW program helps those with disabilities get back to work while protecting their benefits and offering other significant incentives. It was signed into law by President Clinton as “The Ticket to Work and Work Incentives Improvement Act of 1999” with the mission of increasing the options for individuals with disabilities who wanted to return to work.

Benefits Of The Ticket To Work Program

1. 1. 1. 1. It costs you nothing. The SSA oversees the Ticket to Work program. It pays the fees for services you access in order to get back in the workforce.
        
        Earn more. You can make as much money as you want, in your first full year of work and keep your SSDI benefits.
        
        Avoid risk. If you stop working, your SSDI benefits will start again. There’s no need to repeat the application and appeals process.
        
        Keep your Medicare coverage. When you go back to work, you can keep Medicare coverage for 93 months once you complete your trial work period.
        
        No more CDRs. Going back to work with the help of a Social Security Administration-authorized EN means that the SSA will suspend all Continuing Disability Reviews while you are making timely progress toward the goals in the TTW program.

Many people have underestimated the value of SSDI benefits and may be unaware of TTW and its significant return-to-work protections. Learning about these little-known programs can be part of the due diligence of knowing how to provide for yourself and your family when the unexpected strikes.