Maximize your HSA e-Newsletter
Vol. 14, Issue 7
Assessing Your Disability Risk and How to Financially Protect Yourself
Last week I went on a mountain biking vacation with my 15 year-old son. I figured I might crash, as I’m still kind-of new at the sport. I was just hoping it was nothing too bad.
As I write this, I can’t really turn my head very far to the right without some pain. I don’t think it’s anything serious (I hope not!), but I’m pretty sure it is the result of one the wrecks – even though it showed up after my last crash.
But my injuries of course could have been much worse, with the possibility of leading to a disability. A disability happens when you are unable to perform some of the regular activities of life, and nearly a quarter of all American’s experience a disability at some point in their lives.
For many, the most serious consequence of a short-term disability is losing the ability work.
What If You Couldn’t Work?
If Elon Musk were to get hurt riding in one of his rockets, and was laid up in the hospital for 6 months, he would not be able to lead his companies. The stock value might go down, and his net worth might drop. But he wouldn’t ever worry about missing a mortgage payment.
And you certainly don’t have to be that risk to survive a six-month disability. But the fact is, for most people, not working for 6 months would put their income and even their business at serious risk.
So the very first step is just to look closely at your own situation. If you suddenly couldn’t work, what would happen?
For some, their business runs such that their income would continue, uninterrupted. If this is you, congratulations!
Others would see their income drop, but may have enough in savings to keep afloat for quite a while. Kudos, also, to you.
Assessing Your Financial Health
About 69% of Americans, whether working or not, have less than $1,000 saved. In today’s growing economy, that’s $27 more than the federal poverty level for one person. For couples, that puts them $311 short for the month. These statistics don’t account for an unexpected financial emergency, such as an unexpected workplace injury or terminal illness.
Saving even $5 extra each week could help tremendously, but even that’s not enough to cover expenses. In many parts of America, it’s estimated that during a 40-hour week one needs to earn $25 per hour (pretax) to cover rent, $3 an hour to cover car payments and expenses, and $4 an hour to cover utilities and food.
So ask yourself: Can your current financial situation cover these costly basic needs in the event of an injury or sickness that puts you out of work for a short – or long while?
Financially Protecting Yourself
While many health emergencies happen sporadically, many others can be seen before they arrive. Cancers, musculoskeletal issues and similar long-term disabilities, however, often appear unannounced. Even those who follow a healthy eating and exercise regimen can fall ill or find themselves injured at work, whether by their own or another’s doing.
The biggest consideration for you should be how this kind of event would affect your income. If you would be facing large financial pressure if you are out of work for a while, you are taking a big risk.
A disability insurance policy can help cover gaps that traditional policies cannot or will not cover. For the cost of what many people spend on soda, candy and coffee at convenience stores each day, you could blanket your life with something that pays dividends traditional policy don’t.
Call your trusted Personal Benefits Manager and see how thousands are already reducing their financial risks. As part of our Financial Protection Program, we’ve created a disability risk assessment checklist that you can use for free. Simply contact your PBM so we can send it to you via email.
Wiley P. Long, III
President – HSA for America
The HSA for America Maximize Your HSA Newsletter is published monthly and emailed to subscribers at no charge. Subscribe now to stay on top of the critical information you need to know about health insurance, healthshare plans and managing your finances to achieve financial security.
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