When people think about their assets, they generally point in the direction of their homes, cars and retirement accounts. However, your true asset is the ability to make an income. Without it, you won’t be able to pay for your home or car or put money into your savings accounts.
According to a survey by MagnifyMoney, 53 percent of Americans live paycheck to paycheck. Just one missed paycheck can cause the bills to pile up. How long could you go without a paycheck? If you’re like the majority of Americans, you couldn’t go any more than three months.
Fortunately, you do have options when it comes to protecting your income. Disability income (DI) insurance in NJ provides supplemental income if you can’t work due to an illness or injury. You can get this insurance from your employer or from a private insurer.
What is Disability Income Insurance? How Does it Work?
Disability income insurance provides extra income if you can’t work because of an accident or illness. Benefits are paid out so that you can maintain a comparable standard of living and cover your expenses. On average, disability insurance replaces 45-65 percent of your gross income on a tax-free basis.
There are two main types of disability insurance:
Each insurance policy is different, so be sure to ask your financial advisor in NJ questions. For example, what are the base salary caps? Does the policy cover additional services like training to return to your job? What is the waiting period before benefits are paid? How does the policy define “disabled?”
Who Needs Disability Income Insurance? What are the Benefits?
If you rely on a paycheck to get by, you can benefit from NJ disability insurance. Even if you are young, disability insurance is still important. According to the Social Security Administration, 1 in 4 20-year-olds will experience a disability for 90+ days before they reach age 67. Some of the most disabilities include back injuries, heart attacks, cancer and diabetes.
The benefits to having disability insurance are:
If you are interested in taking out long- or short-term disability insurance in NJ, contact Leonard Financial Solutions today. We’ll explain your options and what policies are best for your circumstances.
A college education is something that most parents want to provide for their children. In America, having a solid education is key to landing a better job. But saving for this education can be daunting. Fortunately, college savings tools like 529 plans and permanent life insurance make it easier to save for educational expenses.
Below you’ll find more information about 529 plans and whole life insurance in NJ and which one is a better college savings plan.
529 Plans vs Whole Life: What’s the Difference?
529 plans in New Jersey are similar to a Roth 401K or RothIRA but are intended to help pay for college expenses rather than retirement. Through a 529 plan, you can invest in a variety of mutual funds and earnings will grow tax-deferred. As long as your child uses the money for educational expenses, the withdrawals are tax-free.
While a 529 plan is the gold standard for saving for college, it’s not your only option. Permanent life insurance is also an excellent way to save money. When you pay into your policy each month, some of the money goes towards the premium and some goes into the cash value. The money in your cash value grows tax-deferred, similar to a 529 plan.
Why Permanent Life Insurance is Better than a 529 Plan
Each family is unique, so you’ll have to make the best decision for your circumstances. That said, Leonard Financial Solutions typically recommends whole life insurance as a college savings plan. Here are the reasons why.
529 plans are not bad. They have many advantages, and we understand the appeal to them. However, they are not the only way to save for your child’s post-secondary education. Permanent life insurance is worth a look. If you would like a life insurance quote comparison in NJ, contact Leonard Financial Solutions.