Document

Download Report

Transcript Document

From Here to Security SM

Protect Your Dreams Against a Disability

Presenter Name | Title Based on the experience of Principal Life financial representatives and clients across America

**Why do you work?**

• • • • To pay the bills To secure your dreams for the future To accomplish something To make your life work

What if you become too sick or hurt to work?

• • • What would happen to your income?

How would you maintain your lifestyle? Pay your bills?

What would happen to your retirement dreams and other financial goals?

It ’s time to address your financial security

• • Go back to fundamentals.

Risk protection products are the foundation of a successful financial strategy.

• Americans are looking for ways to be financially secure.

Three-step process

STEP 1: Understand the need. STEP 2: Protect your dreams for the future.

STEP 3 : Review your plan regularly.

STEP 1: Understand the need

In the last

10 minutes

490 Americans

became disabled.

Source: National Safety Council

, Injury Facts ®

, 2010 Edition.

62%

of all personal bankruptcies filed in the United States in 2007 were due to the inability to pay medical expenses.

Source: June 24, 2009,

The American Journal of Medicine

, based on the Harvard University report.

STEP 1 Disabilities play no favorites Breakdown (by percentage of claims) of some typical causes of disability.

Source: Council for Disability Awareness (CDA) 2010 Long-Term Disability Claims Survey, Disability Claims by Diagnosis.

STEP 1 What is your most valuable asset?

Your home may be your

biggest

asset, but your ability to work and earn an income is your most

valuable

asset.

1 2 National Automobile Dealers Association, 2010.

National median existing single-family sale, fourth quarter 2010, National Association of REALTORS ® .

3 Projected cumulative income of a 35-year-old earning $6,250/month, assuming a 4% annual increase to age 65.

STEP 2

STEP 2:

Protect your dreams for the future

How solid is your financial foundation?

STEP 2 Consider your disability income sources • • • • • • Savings Borrowing Group long-term disability insurance Social Security Workers ’ Compensation Individual Disability Income Insurance

STEP 2 Available disability income sources Savings • Most people don ’t have enough savings.

• One year of disability could wipe out your savings.

• You won ’t be able to continue saving for retirement.

Borrowing • What bank will give you a loan without employment?

STEP 2 Available disability income sources Group long-term disability (LTD) insurance coverage • Excellent employer provided benefit – and a great start to your foundation • Benefits usually taxable and have limits Could you live on only 42% of your income?

Chart based on $6,250 gross monthly income ($75,000 annually), with 60% group long-term disability program, assuming a 30% tax bracket for Federal, State and FICA.

STEP 2 Available disability income sources • Social Security Approve only 35% of all claims • Must meet four conditions • Six-month waiting period • Benefits typically replace only a fraction of pre-disability income • Workers ’ Compensation Covers only work-related illness or injury on the job • Coverage and benefits vary

Source: Social Security Online, disabled worker beneficiary statistics for 2009.

STEP 2 You have a lot to lose • Current standard of living • Future earnings • Your home • Retirement savings and other assets • Insurability • Credit rating • Peace of mind • Dreams for the future

STEP 2 Individual Disability Income insurance Protect your ability to work and earn an income with Individual Disability Income (DI) insurance from Principal Life Insurance Company.

• Premiums and benefits guaranteed through age 65 • Tax-free benefits (when paid with after-tax dollars) • Quality benefit provisions • Can be stand-alone or supplemental coverage • Bonuses and incentive pay can be covered • Policy and any applicable discounts fully portable

STEP 3

STEP 3:

Review your plan regularly

• Pick a day you ’ll remember.

• Some events demand immediate attention: Marriage or divorce Birth or adoption of a child Children graduating from college or leaving home Inheritance or other windfall Major increase in debt, including the purchase of a new home Paying off the mortgage New job or promotion Death of a spouse Changing a beneficiary

STEP 3 I can help you: • • • • • Determine appropriate coverage based on your personal situation Determine appropriate policy features and riders Complete forms Regularly review your plan Submit any claims for benefits

Disability income insurance has certain limitations and exclusions. For costs and complete details of coverage, contact your Principal Life financial representative.

While this communication may be used to promote or market a transaction or an idea that is discussed in the publication, it is intended to provide general information about the subject matter covered and is provided with the understanding that none of the member companies of The Principal are rendering legal, accounting, or tax advice. It is not a marketed opinion and may not be used to avoid penalties under the Internal Revenue Code. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, or accounting obligations and requirements.

WE’LL GIVE YOU AN EDGE ® Principal Life Insurance Company, Des Moines, Iowa 50392-0001, www.principal.com