This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Protect Your Future Income With Disability Insurance

The following is a transcript of " Money Girl's Quick and Dirty Tips for a Richer Life, " a podcast from The audio program is available via RSS feed here and at's podcast home page .

Hello and welcome to Money Girl's Quick and Dirty Tips for a Richer Life.

Today's topic: Insuring your biggest asset.

A listener named Marv emailed me with this request:

I purchased a long-term disability insurance policy several years ago after a friend of mine fell off a ladder and was disabled for a long time. However, I had trouble finding objective advice on how to research an insurer and what kind of policy was appropriate for me. I'm sure I got the coverage I wanted, but I didn't have many choices to do adequate comparison shopping. To this day, I don't hear much about this topic.

You're wise, Marv, to have gotten yourself disability insurance. It's the most important insurance coverage to have. It's also one of the most overlooked. And you're right, it doesn't seem to get much attention, given how important it is.

Insuring Your Biggest Asset

Disability insurance insures what's extremely likely to be your biggest asset: your future income. That's the reason disability insurance is so important. It's more important than life insurance, health insurance and auto insurance.

If you depend on your income to pay your bills, you need disability insurance. And if you happen to be independently wealthy and don't need to work, you can stop listening to this episode right now. You don't need disability coverage.

The Risk of Disability Is Real

If you're unable to work because of a disability, disability insurance pays you your income. The odds of becoming disabled are surprisingly high. According to the Social Security Administration, a 20-year-old worker has a 30% chance of becoming disabled before retirement age. By way of comparison, the chances of a 20-year-old dying before age 65 are only 17%. This is the reason that disability insurance is more important than life insurance. Because the odds of becoming disabled are so high, disability insurance is expensive. Premiums can be as much as 1% to 3% of your annual income.
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
FB $116.53 -0.17%
GOOG $690.21 -0.12%
TSLA $238.63 -3.70%
YHOO $36.32 -0.74%
AAPL $93.04 -1.90%


Chart of I:DJI
DOW 17,695.50 -135.26 -0.76%
S&P 500 2,054.52 -21.29 -1.03%
NASDAQ 4,752.9240 -52.3670 -1.09%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs