Pop quiz: What’s the perfect age to buy paycheck protection? If you’re having trouble thinking of the answer, don’t worry. It’s a bit of a trick question. See, there really is no ideal age for paycheck protection. Whether your clients are in their 30s, 40s or 50s, they have plenty of reasons to buy this important product.
Paycheck Protection in Your 30s
Although the average 30-something might think they’re too young and healthy to need disability insurance, this assumption is naïve. People in their 30s can and do suffer from disability in many forms, including cancer and other illnesses, injuries and mental health issues.
For women in their 30s, pregnancy poses a significant risk. According to the Council for Disability Awareness, pregnancy accounts for 25 percent of all short-term disability claims and 9.4 percent of all long-term disability claims.
At the same time, people in their 30s have a lot to protect. They are often starting families and buying houses, and they may have little – or even nothing – in savings. They may owe money, especially in the form of student loan debt. If a disability prevented them from earning a paycheck, they would likely struggle to pay for basic necessities like food, utilities and housing.
Paycheck Protection in Your 40s
The average 40-something may still be in good health, but at this point, they likely understand that their good health will not be guaranteed forever. Illness and injury can make it impossible for a person to work.
According to the Council for Disability Awareness, musculoskeletal disorders are the number one cause of long-term disability claims, accounting for 29 percent of the total. Cancer comes in second, at 15 percent.
Losing a paycheck at this time can be devastating. While some people may have some money set aside in an emergency fund, this could quickly be depleted through a combination of health care bills and lost wages. Meanwhile, people in this age group have mortgages, car loans and other debt. They’re often saving for both their children’s college expenses and their own retirement. In short, they cannot afford to lose their income.
Paycheck Protection in Your 50s
People in their 50s continue to face increasing odds of disability. Meanwhile, they are preparing for retirement.
According to a study from GOBankingRates, more than one-quarter of people say they plan to retire late. In many cases, this is not because people really want to stay in their jobs for so long. It is because they have done the math, and they know they don’t have the savings to retire on time, much less early.
The problem with this is that people often don’t get to choose when they retire. Health issues may force a person to retire early, whether or not they are financially ready. Going without a paycheck at this age is more than a strain on people’s current finances. It’s a threat to their retirement years. Retirement Plan DI can help protect and continue retirement savings efforts.
Paycheck Protection for Any Age
In the end, paycheck protection isn’t tied to a specific age. Anyone who depends on paycheck can benefit from it, whether that person is a healthy 32-year-old just starting a family or a 56-year-old trying to catch up on retirement savings. If your clients count on their paycheck, talk to them about disability insurance and let them know that they are at the right age to buy individual disability insurance protection.
For additional resources on this topic, download our Right Age to Buy DI Handout.