Like the proverbial cobbler’s shoes, doctors often think they’re immune to illness and accidents. Because of this error in thinking, when they do get sick or injured, they’re unprepared. The financial, physical, and mental consequences sneak up on them.
Many physicians adopt the “do as I say, not as I do” philosophy when it comes to preparing for health problems. They advise their patients to go for their annual checkups and get medical and disability coverage.
But getting a doctor to go for wellness or illness visits is usually hard to do. Convincing them that they might need disability insurance someday is next to impossible.
However, most financial advisors suggest taking out a disability insurance policy. It’s a smart way to protect your assets. Physicians, in particular, should have this coverage for these three specific reasons.
1. Disability Insurance Protects Your Assets
As a physician, you are statistically at a greater risk of illness or injury than of death. Especially in the post-pandemic new world, your career is risky. Between invisible, deadly pathogens, irate patients, and regular hazards, your odds of getting sick or hurt are higher than ever.
You might have a healthy nest egg tucked away by now that could buffer you if you can’t work. But why should you dig into that fund when a low-cost disability premium each month could protect your assets?
There are many types of disability insurance options today that will fit your needs and budget. This article by Physicians Thrive gives you more information about disability policies.
The job of a physician is demanding, but it’s also extremely rewarding. You should be able to fulfill your role without concern that getting sick or hurt could affect your family’s finances.
2. Your Job May Cover Part of It
Since disability policies are available for individuals and groups, a lot of employers offer to cover some or all of your premium.
However, the default policies that your job purchases for their employees probably give the standard benefits. In most cases, that means you will only receive 60% of your earned income after the wait clause is over.
Disability policies come in short-term and long-term options. Most insurers offer to cover up to 80% of your income. There is usually a waiting period that varies, so check your policy’s fine print. For a few dollars more each month, you may be able to increase your coverage.
The average disability lasts at least one year. That’s a lot of digging into your nest egg if you didn’t have protection in place. And if you didn’t have a savings account to use when you were disabled, your mortgage, vehicles, and other important possessions are in danger.
If your job offers you disability insurance, even if you have to pay for all of it, it’s a smart financial move. Plus, since you’re paying the premiums, you might be able to get a tax break.
3. Disability Insurance Could Help You With Retirement
Some insurers offer disability insurance protection that works hand-in-hand with your retirement plan. Most plans replace part of your earned income, and that’s it. But a few programs have specialized plans that replace your retirement savings, too.
These plans have a benefit that pays into a trust the amount that you’ve been contributing to your retirement. The money is then invested wherever you choose until you’re 65. At that time, it’s distributed to you monthly as a supplement to your retirement income.
However, whatever your policy benefits end up earning you over the years of your investment is subject to taxes.
Trusts and individual disability income policies are covered under their own taxation rules. Whomever the beneficiary is of the trust is responsible for taxes on the earnings.
Physicians often try to diagnose and care for their own health conditions themselves. But no matter how knowledgeable you are about your body, you are still vulnerable to long-term illnesses and injuries.
Disability insurance is one way to protect yourself and your family from financial hardship if you do get sick or harmed.
You work hard for your money. With a little protection in the form of a disability policy, you don’t have to lose track of your financial goals if you’re out of work.