Was I right? 16 Changes That May Happen in the Near Future

Was I right? 16 Changes That May Happen in the Near Future

November 28, 2023
By The Council for Disability Awareness Disability Insurance, Employee Relocation, Featured, Uncategorized, Workplace

By Bob Herum, MSFS, CLU, ChFC, RHU, REBC, Interim President of the CDA I was asked to relook at blog I wrote during the height of the Covid-19 pandemic and explore how well I had "prognosticated" future developments. Like any such endeavor, there were certainly .. more »

By Bob Herum, MSFS, CLU, ChFC, RHU, REBC, Interim President of the CDA

I was asked to relook at blog I wrote during the height of the Covid-19 pandemic and explore how well I had “prognosticated” future developments. Like any such endeavor, there were certainly some misses in the narrative, but on the whole, I feel that we had more hits than misses. I will let you be the judge.

Getting tired of hearing the term “new normal,” or other permutations out there? I am, but it does force you to think about how different life will look moving forward, past the changes COVID-19 created. I think it’s natural to want to return to how things were before, but I wonder if that is reasonable or even likely. It’s caused me to think not only about the disability industry, but also a broader view of what day-to-day life will entail.

Here are some of my thoughts for you to consider:

Businesses and office buildings will likely restrict employee populations and slowly increase over the next several months or years.

This might not have been that difficult to foresee, however, I think that most initially thought that the pandemic would pass, somewhat like the influenza pandemic following WWI. However, the effort to get employees back into their offices is still a struggle, with the WSJ reporting that several large employers are finally trying to push the issue. In the meantime, many large cities are facing significant financial headwinds with the loss of tax revenues from business that long supported the employees that worked in their downtowns, and the ripple effects to the commercial office buildings, parking garages, restaurants, etc. continues.

Many employees will likely not want to return to the workplace– if required by their employer – and will consider moving to firms that allow them to continue to work

As noted in the point above, this is likely a long-term issue. Many employees who relocated to lower-cost areas of the country were hired during the pandemic and feel they were promised that a remote work schedule was part of their arrangement. Finally, it has been well documented that a significant number of employees did leave their employer when confronted with having to return to their offices. This issue also has affected employers as they look at their office needs and many firms have reduced their office footprints, and even canceled or delayed indefinitely office campus expansion.

Wearing protective masks may become a new normal and be required for months, and maybe even for the next couple of years, particularly in more populated areas and on public transportation.

I am thankful that I missed on this item. However, I do see people wearing masks in malls, grocery stores, and restaurants. However, I have also seen it on motorcycles, bikes, and when alone in a car . . . not sure what that is all about. Don’t think we will ever look like the photos I have seen of Tokyo or in China of most, if not all, those pictured wearing masks.

It will take time for business travel to return to anything resembling the past and may not fully resume to the level it was prior to COVID-19. The convenience of online calls or other digital face- to-face meetings are likely to be preferred.

This prognostication has proven to be on target. The airline industry, AMTRAK, the NYC Transit Authority, and similar entities have all reported less ridership. In the airline industry it has been mostly offset by more those traveling for leisure. However, the lessened employee travel has greatly impacted the financials of local rail, metro, bus, etc., and several large cities have reported dramatic decreases in fee income and are having to look at coming up with other funding and/or increasing the ridership fees. This is likely going to be a huge issue for all providers of public transportation.

Some fast-food restaurants may expand to include a more robust drive-through service.

This was and continues to be true. The WSJ has reported extensively on the growth of drive-through as the new norm. Additionally, the growth of Uber and other meal delivering carriers has also been noted. While fast food restaurants report a return of customers to their dining rooms, most have expanded their staffing for the drive throughs and many fast-food restaurants have reconfigured or added additional drive through lanes.

Other restaurants will reconfigure inside seating arrangements, provide for greater separation, alcove seating, add drive-thru lanes, and create or expand outdoor seating, semi-covered and heated eating areas for general use and for customers who are reluctant to eat inside their restaurants.

Initially, as restaurants reopened, there was a significant effort to increase the spacing between tables. Many restaurants expanded their outdoor seating, and in cold-weather locations added heaters and outdoor structures to protect their patrons from the elements. Certainly, as pointed out in the prior bullet point, there has been a large increase in the number of firms offering food and meal pickup and delivery, and even a year after a return to near normalcy, this has not slowed.

Sporting events, movie theaters and concerts will slowly increase the audience size and likely not allow full occupancy during 2021 and well into 2022.

While it appears that sporting and concert events have recovered to pre-covid levels, the movie industry has lagged. An unforeseen increase in the use of streaming technology and release of movies to vendors, like Netflix, has definitely affected the movie cinema industry. Large cinema firms have either declared bankruptcy or been acquired by other firms and in-person viewership has not returned to the pre-covid levels. People have gotten used to having to wait only weeks or months for a film to make its way to their large-screen video systems they purchased while they were locked in their homes.

There may be a small, but vocal number of employees who will refuse to be vaccinated. Many employers may require them to either work remotely and/or sever their employment if remote work is not available.

I foresaw the issue of employees refusing to be vaccinated, but never envisioned the breadth of this phenomenon. Certain critical industries had very high percentages of their employees refuse to be vaccinated, and it significantly effected the Health Care industry. Many parents refused to have their children vaccinated, which caused significant disruption to schools attempting to reopen their doors. As recently as last week, I was informed by my caregiver that while she was vaccinated, she refused to have her children vaccinated due to concerns on adverse reactions. This will likely make it more problematic when the ‘next’ pandemic hits and the significant percent of the general public is skeptical of the positives of being vaccinated.

Buildings (new and existing) will be reconfigured to allow greater spacing and will have high-end air filtration systems installed. This could also occur over the next couple of years to planes, trains, buses, and other public transportation. Many will require immediate testing upon entering to ensure a person is not contagious.

In the short-term, as firms began to require in-person office presence, personal workstations were expanded, personnel scheduling to lessen the footprint in work areas, and other protective measures were initiated. Most of these reactions have eased as the covid exposure has lessened. However, firms that had built their business model and shared office space are struggling, with several large enterprises either closing or declaring bankruptcy. Thankfully, the wholesale covid testing has abated and covid shot record is now a historical relic.

Property casualty carriers will likely add or strengthen business interruption policy language to exclude pandemics.

After an initial flurry of court cases in which policyholders claimed that business interruption policies designed to provide financial resources due to fire or weather should also cover mandated closure of businesses and medical practices, the courts universally ruled that the policies did not cover such situations. However, I have also read that the property casualty carriers have strengthened their contractual language and now specifically state that a loss due to pandemics is a non-covered event.

New types of business insurance plans will likely be created to cover potential future pandemics or be added as an optional rider to existing business interruption policies.

Totally whiffed on this one . . . seemed like an obvious business need but suspect the actuaries could not figure out how to price this risk, and or the computed premium would have made it a “hard sell.”

Older citizens will be reluctant to return to their houses of worship, and will join online services, if available.

Places of worship very quickly understood that their congregations, particularly older congregants, were not going to attend in-person services. This extended even to funeral homes, weddings, etc., and now the new norm seems to be a face-to-face service which is live-streamed to those who cannot or will not attend in person. Also, while I focused on “older citizens,” I think it’s safe to say that this was the norm among all age groups.

There will be fewer physical banks, credit unions, government offices, and general business offices. These establishments will start providing their services virtually.

This phenomenon will continue to change how we interact with our support industries into the future. Financial institutions, like banks and credit unions, have closed local branches. The covid pandemic likely only sped this shift, and likely all of us do most, if not all our banking online. As noted previously, downtowns are struggling to get the workers back to their physical locations and most firms that do require their employees come to the office are allowing a reduced schedule, ie., two or three days a week. This decrease in the in-person visitation will further speed up the process of firms reducing their physical locations.

Grocery chains may offer more ready-to-serve entree options to support individuals reluctant to eat out.

The grocery chains certainly were quick to pick up on this opportunity. Additionally, hundreds of local and national firms rolled out home delivery of microwave or stove-ready entrees, and I have not seen this abate as we have moved into a post-covid environment.

While already started, the delivery of day-to-day meals, personal items, prescriptions, etc., will grow significantly.

A definite paradigm shift occurred in this area. Every grocery chain has invested in both technology and staffing to support online orders and delivery or pick up by the customer. It also moved into the drug chains, and most, if not all, have online ordering and delivery as an option. Heck, you can order your car online and have it delivered to your door. This will impact who and how many sales-support employees are necessary in a myriad of industries.

Entirely new businesses and industries will come into existence that you and I can’t even imagine.

I still think we haven’t seen the full effect on our economy and how we interact with businesses yet. Think about how your interactions with your bank, family, customers have evolved over the last couple of years. How many had heard of “Zoom calls” before the pandemic? How many of us totally abandoned going to stores and the malls, became online shoppers, and how that has accelerated the growth of the online buying experience? This transition is often very disruptive, and there are casualties . . . closed businesses, displaced employees, etc., but the old saying that “when one door closes, another opens” will hopefully help us as we continue to evolve our “new reality.”

Lonely woman stares out the window. Protect Your Income, Open Enrollment 2023

On Loneliness

November 21, 2023
By The Council for Disability Awareness Depression, Featured, Mental Health, Uncategorized

In a couple days, it'll be Thanksgiving. And in my house, that means we sit down for... a home screening of legendary director John Hughes' 1987 film Planes, Trains and Automobiles. I love to keep track of the classic comedy tropes on offer, and ever .. more »

In a couple days, it’ll be Thanksgiving. And in my house, that means we sit down for… a home screening of legendary director John Hughes‘ 1987 film Planes, Trains and Automobiles. I love to keep track of the classic comedy tropes on offer, and ever since I heard that the original script was for a film twice as long as what’s on the DVD in my library, I’ve been pining to watch a director’s cut.

Over my many years of viewing this holiday classic, I’ve come to appreciate the character portraits it presents. I find myself agreeing with Roger Ebert that Neal Page and Del Griffith are both, in their own ways, lonely souls. And isn’t that ironic, given that Thanksgiving is a holiday that evokes such strong images of togetherness and connection, like the iconic 1943 Norman Rockwell painting from his “Four Freedoms” series.

But the reality is, you can still feel lonely while being with other people. That’s because loneliness, as social-science researchers define it, is “a perceived/subjective condition in which an individual is dissatisfied with the quality and/or quantity of their social relationships.”

So if loneliness is a “perceived/subjective condition,” how is it that the U.S. Surgeon General issued an advisory report earlier this year with the title Our Epidemic of Loneliness and Isolation?

As the U.S. Centers for Disease Control and Prevention’s website points out, social isolation and loneliness have been linked to increased risk for

Heart disease and stroke
Type 2 diabetes
Depression and anxiety
Addiction
Suicidality and self-harm
Dementia
Earlier death

An influential 2010 meta-analytic¹ review concluded that “the influence of social relationships on the risk of death are comparable with well-established risk factors for mortality such as smoking and alcohol consumption and exceed the influence of other risk factors such as physical inactivity and obesity.” A key figure in that review made its way into another scholarly paper, from there into the 2023 Surgeon General’s advisory report, and ultimately into a host of click-baity headlines (just a sampling: Loneliness poses risks as deadly as smoking: surgeon general and ‘Angry, sick, and alone’: Social isolation is as bad for your health as smoking 15 cigarettes a day).

Brigham Young University Professor Julianne Holt-Lunstad, the lead author of the “15 Cigarettes” study, provides some nuance and context around this research—but her bottom line is clear: social isolation and loneliness is indeed a major public health concern, just like smoking was sixty years ago.

And researchers are on their way to figuring out how being lonely can lead to poor health outcomes. There’s lots of evidence that loneliness can “provoke changes at the cellular and tissue level” and most interestingly that it can lead to “altered structure and function in specific brain regions and networks.”

Now I get why the Norwegian pop group 3-11 Porter can sing: “Hello I’m so lonely / And it feels like a disease.” And the title of that song gives us a clue as to how we go about dealing with this disease of disconnection. In her TEDx Talk (highly recommended viewing!), Julianne Holt-Lunstad says: “My research suggests that one of the single best things that you can do for your health is to nurture your relationships.”

How do you “nurture your relationships”?

For starters, you need to take inventory of where you stand in terms of those relationships. Professor Holt-Lunstad suggests asking yourself the following questions (this is drawn from her TEDx Talk, at around the 10-minute mark):

How many friends do I have?
How frequently do I interact socially with others?
Do family/friends care about me? Do they understand the way I feel?
Can I rely on them? Can I open up to them?
Do family/friends make too many demands? Do they criticize me?
Do they let me down? Do they get on my nerves?

These are a lot like the kinds of questions that get asked in the various survey instruments social science researchers use to measure loneliness. Yes, you too can be a researcher!

Next, when looking at building, growing, or repairing your relationships, keep the acronym GRACE top of mind. Social neuroscientist Stephanie Cacioppo (a/k/a “Doctor Love”) came up with it as a way of highlighting the key elements of strategies for successfully enhancing our connections. It stands for Gratitude, Reciprocity, Altruism, Choice, and Enjoyment.

In a future blog post, I’ll share with you my experiences putting GRACE into practice—and how volunteering has been an important factor in helping me achieve greater wellbeing.

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.

¹“Meta-analysis is a quantitative, formal, epidemiological study design used to systematically assess previous research studies to derive conclusions about that body of research.” (source)

Employee discussing benefits with HR. Protect Your Income, Open Enrollment 2023

Social Security’s Disability Program Is Not a Substitute for Long-Term Disability Insurance

November 16, 2023
By The Council for Disability Awareness Disability Insurance, Employee Benefits, Facts, Featured, Financial Planning, Long Term Disability, Protect Your Income, Short Term Disability, Social Security Disability Income, SSDI, Uncategorized

Nobody wants to spend money if they don’t have to. One way people save is getting a cheaper version of something. Sometimes this is a good idea, or it at least makes sense. It is probably a good idea to try the more affordable cabernet, a drill from Harbor Freight instead of a DeWalt, or Old Navy Athletics instead of Lululemon. You might notice a difference, but the budget friendly option will still work well.

Other things, like safety equipment, maintenance, or health care may be poor choices for cutting costs or corners. Generally, saving on luxury items is good, but jeopardizing quality on essentials is risky.

Someone might think that long-term disability insurance is a luxury they can save on, especially because Social Security has a disability program. That is a bad choice for several reasons. Fundamentally, Social Security disability and long-term disability are different insurances with different goals, benefits, and requirements. If you need long-term disability insurance and you only have coverage for Social Security disability, you will regret your choice almost immediately.

Long-term Disability Background

People usually get Long-term disability insurance through their employee benefits. In those cases, the employer has a contract with an insurer to offer coverage for workers. The workers can access benefits, often 60% of their salaries, if a medical condition causes them to miss work for a long period of time, usually over six months.

Most policies will provide those payments if the worker’s medical condition keeps them from working and earning the wages they were making at their job that provided the benefits for up to two years. Often, at that point, the policy will continue if the worker is unable to perform other work that would pay them a certain percentage of what they made before.

Insurers usually pay benefits quickly, especially if a worker was already on short-term disability though the insurer. Benefit payments get more complicated due to things like benefit limitation conditions and other clauses in specific agreements. Though imperfect, long-term disability delivers strong income replacement in a timely manner for workers stricken with injuries or illness.

Social Security Disability Background

Social Security is the federal government’s insurance branch, giving rise to the joke that the federal government is an insurance company with a standing army. Social Security’s most popular program is the retirement benefit for workers. Social Security defines that program as “old age insurance.” After robot insurance, “old age insurance” is my favorite insurance. Worried you might become old? Let Old Age Insurance help protect you from the ravages of time.

More relevant is Social Security’s disability insurance. Social Security disability sounds like it should be a substitute for long-term disability. Social Security disability will pay benefits to workers whose medical conditions keep them from working for a year or more and who are unable to perform a significant number of jobs in the national economy. The amount of Social Security benefits depends on how much the person has paid in. To qualify, the person must have paid their FICA taxes and met minimum work standards over their career. People usually say they earned enough quarters for Social Security coverage.

Social Security disability certainly sounds like long-term disability insurance if you don’t look closely enough. You could say the same thing about rugby and football, or many of the Kardashians. Once you start to look at even basic details, you’ll see huge differences.

Social Security Disability is Different from Private Long-Term Disability Insurance

Category	Long-term Disability	Social Security Disability
Processing Time	Approvals are fast, in a matter of days or weeks	Approvals are slow, measured in months and usually years.
Payment Amount	Based on your salary when you left work, often 60%	Based on your lifelong contributions, averages $1400/month, caps at $3500/month for an individual.
Approval Rate	High and you don’t usually need a lawyer	Low, approving less than 40% at first application, and you usually need a lawyer
Standard for Disability	Factors your income and experience	Only awards benefits if you can do basically no jobs, regardless of pay or your experience. If you can do entry level, sit-down work, you aren’t disabled unless you are “approaching advanced age.”
Medical Insurance	Does not provide medical insurance	29 months after your disability begins, you may qualify for Medicare.

If you rely on Social Security disability to replace your income, get ready to wait, likely for one – two years, with no income, while you and the attorney you had to hire fight to convince Social Security you aren’t lying or exaggerating. Then, when you get benefits, you will get your backpay, but you’ll owe taxes on it. The amount you get will be much less than what you were making.

Also, while you are waiting with no income for Social Security, you’ll also have no insurance, your family dynamics may crumble, you are at high risk for depression, and if you try to find work, Social Security will likely hold that against you.

Social Security disability is a public safety net. It provides minimum benefits to people who need it. Congress did not design Social Security disability to protect your income. Instead, Social Security disability gives you some basic protection if you have nothing else.

In that way, Social Security disability is like Social Security Old-Age Insurance (Retirement). Nobody advises anyone to rely solely on Social Security for retirement. Social Security should be just a part of your retirement unless you have no other options.

Social Security disability functions the same way. It is a part of your income-protection plan, but you need additional coverage, most often through your employee benefits. If your company offers long-term disability insurance, it is a smart idea to opt into the coverage. Preserving your household income in the case of accident, injury, or sickness goes a long way to helping your family deal with the situation.

Unlike Social Security disability, long-term disability insurance is structured for immediate assistance and a closer approximation of your income. The private benefit pays more and pays sooner.

The Best Situation

For someone who is disabled, the best scenario is to have private disability insurance that will help immediately. Then, the Social Security disability benefit will help when Social Security approves the claim. That will allow the person to have the initial protection and the long term benefit, such as Medicare. Social Security disability also plays a big role if the private disability insurance has time limitations on certain medical conditions. Some policies have a time limitation for all conditions, providing only two – five years total of benefits.

Even when your long-term disability covers less than you hoped for, it still covers you during the period when you can be applying for Social Security and moving through the process. If your long-term disability only serves as a bridge, it is important to remember what an important bridge it is.

Conclusion

When you look at the elective benefits during open enrollment, you might think that long-term disability insurance is a place to save a little bit of money. Investing a small amount to protect your income is the smart move. It can save so much more in the long run. Long-term disability insurance is the only resource you might have to help you pay your bills if you an injury or accident keeps you from working. Social Security, lawsuits, workers compensation, and even a family member finding more work all take more time and are less reliable than having long-term disability insurance lined up.

Protecting your income for you and your family takes multiple approaches including disability insurance, life insurance, Social Security, retirement, and so on. When your employer offers you long-term disability insurance, you should probably take it.

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 portrait, wondering about Social Security benefits. Protect Your Income, Open Enrollment 2023

Does Social Security Retirement Replace Social Security Disability Insurance?

November 7, 2023
By The Council for Disability Awareness Disability Insurance, Featured, Financial Planning, Protect Your Income, Social Security Disability Income, SSDI, Uncategorized

By Steve Perrigo Social Security Disability Insurance (SSDI) and Social Security retirement benefits are two vital programs administered by the Social Security Administration (SSA). This year an average of almost 67 million Americans per month will receive a Social Security benefit, totaling about $1.4 trillion .. more »

By Steve Perrigo

Social Security Disability Insurance (SSDI) and Social Security retirement benefits are two vital programs administered by the Social Security Administration (SSA). This year an average of almost 67 million Americans per month will receive a Social Security benefit, totaling about $1.4 trillion in benefits paid during the year. Social Security is the major source of income for most people over age 65, but the agency provides more than just retirement benefits. Last year, retired workers and their dependents accounted for 76.9% of total benefits paid. Workers with disabilities and their dependents accounted for 11.6% of total benefits paid, according to the agency.

SSDI and retirement benefits were both created to provide financial support, but they serve different purposes. Social Security Disability Insurance is a federal insurance policy that you’ve paid into via your FICA taxes for all the years you worked. One hundred fifty nine million American workers have access to this program. If these individuals become unable to work due to an injury or disability, they are covered by SSDI. The monetary support you receive through Social Security disability benefits continues until you’re able to return to work on a regular basis or until retirement age.

Social Security retirement is also paid into via your FICA taxes. Retirement benefits are intended to provide an income stream once you reach retirement age, which can be 65 or 67 years of age depending on the year you were born.

Some people mistakenly believe that if they receive SSDI, they forgo their Social Security retirement benefits or can receive both SSDI and retirement simultaneously. They are two separate benefits, but one dovetails into the other. Social Security disability benefits automatically convert to retirement benefits when beneficiaries reach full retirement age. So, when you receive SSDI benefits, it’s similar to getting your full retirement benefits early. In addition, you may also be able to receive Medicare coverage earlier than age 65, as Medicare is included with SSDI benefits after a waiting period.

How SSDI Benefits Are Calculated

The SSA determines your benefit amount based on your lifetime average earnings before you became unable to work. Your payment amount will be calculated using your covered earnings. Again, this is money you made at jobs where you paid FICA taxes.

Your SSDI monthly benefit will be 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 2023 is $3,627 per month, up from $3,345 in 2022.The SSA and SSDI representation organizations have benefits calculators that you can use to obtain an estimate of your monthly benefits. This year, the average SSDI payment for an individual is $1,484 while the average monthly benefit for a recipient with a family is $2,616. SSDI also protects your retirement money with an earnings freeze that could result in a higher retirement income.

Latest Amount and Quarters of Coverage explanation

In 2023, the amount of earnings required for a quarter of coverage (QC) is $1,640. 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. You can only earn 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 rise. The credits you have 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 (40 QCs) to qualify for Social Security retirement benefits. The SSA bases the amount of your benefit on your highest 35 years of earnings.

While you cannot receive SSDI and Social Security retirement benefits at the same time, you can transition from one program to the other based on your changing circumstances and age. If you or someone you know is considering applying for SSDI, we advise consulting with a Social Security representative to help navigate the complex SSDI program and ensure the SSA receives complete information based on your individual circumstances.

Does Social Security Retirement Replace Social Security Disability Insurance?

November 7, 2023
By The Council for Disability Awareness Disability Insurance, Featured, Financial Planning, Protect Your Income, Social Security Disability Income, SSDI, Uncategorized

By Steve Perrigo

How SSDI Benefits Are Calculated

Latest Amount and Quarters of Coverage explanation

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

Does Social Security Retirement Replace Social Security Disability Insurance?

November 7, 2023
By The Council for Disability Awareness Disability Insurance, Featured, Financial Planning, Protect Your Income, Social Security Disability Income, SSDI, Uncategorized

By Steve Perrigo

How SSDI Benefits Are Calculated

Latest Amount and Quarters of Coverage explanation

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

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.”

Two friends comforting each other - Personal Stories

Can Grief Become a Disability?

October 26, 2023
By The Council for Disability Awareness Depression, Featured, Finance, Grief, Mental Health, Personal Finance, Personal Stories, Protect Your Income, Uncategorized

The short answer is “yes.” Grief is a natural and powerful response to loss that can sometimes overwhelm us. And, few of us grieve in the same way. We might experience it emotionally, physically, or cognitively, but for most of us, grief becomes manageable over .. more »

My own experiences with grief came into focus recently through my work with The Council for Disability Awareness. The unexpected passing this past August of The CDA Director, Carol Harnett, had a profound effect on everyone who knew her and worked with her. She was a tireless leader and passionate about her role.

For me, that loss triggered memories of past grief reaching back many years. The most difficult loss was the death of my husband and the unexpected financial setbacks that it brought on. There were some tough times when I felt overrun with emotions that I wasn’t sure would pass. But, with therapy and the understanding of wonderful friends and family, I overcame my emotional struggles. I feel fortunate.

However, for many people, grief can become so severe and prolonged that it becomes debilitating and may become classified as “prolonged grief disorder.” For many, this experience of grief makes social interactions difficult and affects their ability to work. It can be so disruptive that it could be classified as a form of temporary disability. The Americans with Disabilities Act (ADA) defines mental impairment – such as complicated grief – as a disability if it substantially limits someone’s ability to work.

Short-term disability insurance may provide coverage for prolonged grief disorder (or any other mental health condition) depending on different factors. If you have disability insurance, be sure to review your policy for any limitations or requirements.

At the time of my husband’s death, I was able to work and was fortunate to have my therapy covered by insurance. However, back then, I didn’t have disability insurance which would have made my financial burdens significantly easier.

I wouldn’t be sharing this story except for my involvement with The CDA. Our mission is to raise awareness of the importance of disability insurance for all working Americans. And now for me, it’s personal. My message is this: please take full advantage of all income protection programs offered by your employer and/or make sure you take out individual policies. There are many resources available and you can visit realitycheckup.info.

If you or someone you know is struggling with profound grief it’s important to seek support. Talk to your physician, family, or friend, or seek counseling through therapy or a support group.

Grief

Is like the ocean, it comes in waves,

Ebbing and flowing. Sometimes the water

Is calm, and sometimes it is overwhelming.

All we can do is learn to swim.

–Vicki Harrison

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.}

Disability insurance

Disability insurance

Category: Uncategorized