Insurance for your paycheque
Help protect your most valuable asset with disability insurance
Are you protecting your most valuable asset?
How much will you earn in your lifetime?
Total potential earnings to age 65, assuming a 3.1% increase every year.
Over a 30- or 40-year career, your accumulated income is likely to be far more valuable than any other asset you’ll own.
But these day-to-day expenses aren’t the only ones you may face. You might also have added costs like medication, home modifications or childcare.
It could be difficult to maintain your lifestyle for a long time if you couldn’t work because of an illness or injury.
There are options available – but are they realistic?
If your spouse needs to reduce time at work or give up their job to take care of you, it could be difficult to maintain your lifestyle on a reduced income (or no income at all).
RRSP and savings
You could withdraw from your RRSP or investment savings (if you have them). However, you’d have to pay taxes to do so, and it could mean you won’t have enough money for your retirement. Or you may have to delay retirement.
Loans and credit
If you really need cash to pay the bills, these are a short-term option. However, it’s likely they’ll leave you further in debt. Plus, it can be a challenge to get a loan normally; getting one when you can’t work might be impossible.
There are a couple of options here, but each have limits:
• Canada Pension Plan or Quebec Pension Plan: You must have a severe and prolonged disability that stops you from working any job.
• Employment Insurance: Offers limited benefits
• Workers’ Compensation: Only covers on-the-job disabilities
Sell your assets
Would you be willing to quickly sell assets to meet your needs? What impact will the sale of these assets have on your lifestyle?
Disability insurance coverage through your workplace could help, but it may not provide enough coverage. Plus, if you switch jobs, your coverage almost certainly won’t come with you.
We're here to help!
For more information about term and permanent life insurance, get in touch with our professionals.