Being a parent on your own can often be similar to walking the tightrope with no net. It could be because the single parenting experience is similar to walking a tightrope with no catch. The role of parent and teacher, counselor and chauffeur, and many other responsibilities is challenging enough by itself. What happens when you’re the breadwinner’s sole source of income? It is genuinely an extremely high-wire act.
It might be difficult in the case of a financial crisis if you don’t have a backup plan in place. To handle the potential that an illness or injury would affect your earnings. Unfortunately, this is the case for a large portion of women. According to the Council for Disability Awareness research, 52% of single, working women aged between 20 and 65 don’t have disability income insurance. Nearly one-third of them said they’re “extremely” inexperienced for a disability lasting three months. It leaves 1 million women in severe financial danger if they suddenly lose their income.
Timing is Everything
Insurance isn’t the most thrilling purchase around (although we’re trying to improve it). Disability insurance may be pushed to the bottom of the priority list when there are so many items to buy and bills to pay on a tight budget.
We have a common question from potential clients if Ottawa Life insurance will cover those unable to work due to an illness. Although, in most cases, the answer is yes, it’s likely to be too late at this point. It’s essential to have insurance before the time of need. But no matter how vigilant you are, you’ll be in danger, and injuries and illnesses don’t wait until you’re ready to face them.
What Amount of Disability Coverage Will Parents with Children Need?
Depending on the situation, the exact amount will differ for everyone. The majority of short-term disability insurance policies will cover around 60% of earnings. For some, that could suffice to pay for essentials, such as rent and car payment or groceries and utilities. Others, however, are faced with the thought that taking the chance of a reduction of 40% in pay could be an upsetting prospect.
The positive side is that you buy individual disability insurance using after-tax funds. It means that a monthly payment of 60% could be closer to your actual salary than you imagine. Disability benefits get not considered income, so they will not be taxed.
Suppose you are covered for disability by your company. In that case, the benefits you are entitled to will be subject to taxation on income. If the amount of coverage exceeds 60% of your earnings, you may feel the pinch, even more, when the tax gets taken out.
What Is the Cost of Disability Insurance? Cost?
There’s no universal answer to the amount disability insurance will cost you. The general rule for both extended- and short-term disability insurance is 1 and 3% of income. You may have to pay a different amount for disability insurance depending on your age, job, and health status, as well as the policy you choose.
The more monthly benefits, the greater your benefit every month if your disability claim is accepted. However, the cost will go up, too. If your budget isn’t as limited, you might be able to choose the amount that will meet your direct costs.
Time is one of the resources that single parents don’t have. We’ve tried to make it as fast and straightforward as to find out the amount disability insurance will cost. Contact us now! Ottawa Life insurance can assist you with your professional and personal insurance requirements. Call Ottawa Life insurance at (613) 454-1424 or email us at info@ottawa-lifeinsurance.ca for further information.
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