[Note: You may have to click "load images" in your email program if you don't see my pix at the right. Also, if you want to see the previous editions of this newsletter CLICK HERE. ]
Dear Everyone!
The first article is a short commercial about me and why I do this biz. It was actually a requirement for a MoO training class I recently attended... you had to write an under three-minute "commercial" for yourself. It was a good exercise. You should all try it and it may help you in whatever business you are in.
I've been wanting to write something on DI for a long, long time... but never found the time! It seems that DI is getting very popular now... especially since the Christopher Reeve tragedy and death, so I hope this piece helps get you thinking about what your situation would be should something really terrible happen to you.
And yeah, bad stuff DOES happen. You can't insure yourself against everything but you can... and should insure yourself against the really bad stuff... the stuff that will put you on welfare... death, sickness, disability.
That's what insurance is all about... and it is what I do for people.
-Al
|
Why Do I Do This?
|
People always ask me why I'm in the financial industry. They say "Al, you have a Masters degree and you know more about computers than anyone on the planet. Why finance? Why Mutual of Omaha of all companies?"
The answer is simple. I enjoyed working in high-tech but I've ALWAYS had an interest in DIRECTLY helping people to have a better life. Yes, writing computer programs that run the payroll helps someone somewhere. Volunteer work was good... but as I got older I wanted something more direct... like teaching or social work or community organizing... like what I had when younger.
I was a Vista Volunteer (Georgetown, KY, 1969), a teacher (Diana, W.VA, 1970,) and a social worker (City of Hampton, VA), 1973) and as I said spent a number of years is the computer industry. Nothing I did in those later years was as satisfying to me as those early jobs.
When I decided to make a change, I looked around to see what options an "older" person had... and I saw that the financial industry would give me exactly what I was looking for.
I first interned with another broker and then went though a lot of training with the healthcare carriers. At the same time I talked with a lot of financial companies... you would know the names.
They all told me about how great their products were and how much money I would make and all the wonderful trips I could qualify for. It was all about them... and not about the clients.
Then I found Mutual of Omaha (I call them "moo.") Their goal is not to simply sell products... or to recruit a million agents. They bring in smart, caring men and women to counsel and educate people on how to have a better, less stressful, more productive life. The mission of MoO is to help people increase the return on their savings and lower their taxes. It's that simple. In other words we are educators and financial consultants not salespeople.
For me it's not about money. I'm already wealthy in that I have good health, a good wife, and a balanced life. Next to those, money pales in importance.
Mutual of Omaha said to me "Counsel clients about our financial solutions because they are excellent for most people. But if we don't have the right solution for the client, provide solutions from anyone else. It isn't about 'us' it's about doing 'right' for the client," and that is why I joined. Besides, I grew up watching Wild Kingdom every Sunday night!
That's why I'm here and why you are reading this.
|
Disability? Who Me?
|
One of the ways we agents help to increase the return on savings is by making sure that you don't have them picked clean by injury, sickness, or death. Everyone knows about how life insurance can protect you (or your survivors) from dying broke. And we all know how health insurance will pay the big claims that would decimate an average family's savings.
But what about one you have not thought about. Say you don't die and you are not sick... but you become disabled?
Why don't more people have long term disability? I just don't understand it. The coverage is cheap and the protection is good. But no one thinks they will ever get disabled... until they know someone who has been.
Disability coverage has only a few moving parts that are easy to get your head around.
So what is the hesitation? Simple. Everyone has this idea that State Disability Insurance (SDI) that we all pay into through our jobs... is going to take care of us. (This is the same foolishness that Medicare will pay for long term care in a nursing home... NOT!)
Folks, disability insurance (known as DI) protects your paycheck.
You protect your transportation machine (your car). You insure your bodily machine (yourself) but do you safeguard your income machine... your pay?
No you don't. Why? "Hey man, no problemo, Allano. Calleefornyah has me covered, man."
In your dreams!
If you make $60,000 a year you will get about $2540 a month from SDI. For how long? ONE YEAR! Yeah, that's right... one year. Big whoop!
In a perfect world we could insure our paychecks 100%. Well guess what. No insurance plan wants you to be better off financially when disabled than working? Why? Because no one would ever go back to work!
Just about all plans, no matter if you have just SDI, or private coverage with SDI, or just private coverage (starting year 2) will insure about 55% to 60% of your paycheck.
There are a million ways to configure a disability plan in CA. In this state, the state plan will work out to about 55% of your income up to a limit of about $80,000 (meaning you get about $50,000 in benefit... see http://www.edd.ca.gov/pdf_pub_ctr/de2589.pdf for the benefit chart... easy to understand.) If you add private coverage you can get about 65% the first year.
Here is a simple example... and a strategy that I like. Let's let the state take care of us for the first year. After that, let's have a 5 YEAR plan in force. Let's assume you make $60,000 gross income at your job.
Let's have the plan that has a 1 year "elimination"... in other words it does not kick in until you have been disabled for 365 days... meaning it starts the day that SDI ends!
You just had an auto accident where you broke both legs, had some head trauma... you are looking at being out of work for two and a half years... maybe three if there are complications.
For the first year, SDI is going to pay you $2450 a month... or just under $30,000.
Not bad. That's why people WANT to come to CA!
Starting the second year, the state pays zero. BUT... your disability policy (that you got from me :-) will pay you $2800 a month for the next five years. That's $33,600 a year.
OK, sounds good, right? You want to know what it cost? If you are a 45 year old man the monthly premium is... $67. If you are a 45 year old women... $97.
(Why are women 30% more than men? That's a story in and of itself... but the stats don't lie... women get sicker and/or suffer more disabilities than men. Men just die younger! Why do married men die before their wives? Because they WANT to! :-) )
So for two or three bucks a day... like one Frappuccino at Starbucks you can go to sleep each night knowing that if a major bad-ass "something" happens to you... accident, disease, recuperation from surgery, or physical therapy... you are going to have at least half your income.
What can you do with half? You can at least pay the mortgage so you don't end up on the street... and you can put beans and rice on the table. It beats hell out of losing the house... and going on welfare.
It won't happen to you? Well, if you say so. But it has happened to others.
· A 35-year old person has a 50% chance of being unable to work for more than three months before 65. (Society of Actuaries)
· A 30-year old man is four times more likely to be disabled and need disability insurance than to die and need life insurance. (JHA Disability Fact Book, 2006)
· 66% of the disabling injuries suffered by workers in 2003 occurred off the job.
(National Safety Council, 2004)
· 46% of bankruptcies in 2001 were caused by a major medical illness or injury.
(Health Affairs)
· 54% of American workers with financial dependents have not done any specific planning for their disability or a spouse's. (2004 MetLife Benefits Trends)
· 53% to 79% of Americans live paycheck to paycheck (Consumer Federation)
If you are in reasonably good health now and you don't have a hazardous job, the cost of this DI peace of mind is cheap... and there are ways to structure DI with shorter benefit periods (like two years) for a lower premium... for less than you pay for your house and car insurance.
Fortunately, more and more baby-boomers and those younger realize that after health insurance and life insurance (LI), DI should be on the list... and they are starting to "talk" about it. In fact, I could make the case that DI is often more important than LI for some people.
There are four things that can wipe you out: death, sickness, and disability. Why take the risk when you don't have to?
|
|
=================================
Well, that's a wrap for this issue. I hope you've found some of the info above useful and interesting. If you have questions about life or health coverage, safe-money annuities, or employer group benefits just give me a call or send email.
Sincerely,
Alan N Canton
InsuranceSolutions123 Agency
InsuranceSolutions123.com
916-962-9296
CA License # 0F31110
|
|
|
Al Canton, Owner
|
 |
I'm Al Canton, owner of the Insurance Solutions Agency.
Everyone promises the best service, etc. So I won't bore you with that message.
Bottom line, I know health insurance, work-supplements, medicare, life, and annuities.
Most importantly, I'm honest. I will not put you in a product just for the money. I've been here 25 years and I've built my business reputation on integrity and honor.
It's that simple.
|
|
|
