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What Single Moms Should Know About Disability Insurance

Being a single parent can sometimes feel like walking a cable car without a net. This may be because being a single parent is really like walking on a leash without a net. Taking on the role of parent, counselor, teacher, chef, driver and everything else is difficult enough in itself. But when you are also the sole provider? It really is a high thread.

Not having financial security if an injury or illness disrupts your income can be a stressful situation. Unfortunately, that is the reality for a majority of American women. According to research from the Council for Disability Awareness, 52% of single working women between the ages of 20 and 65 have no disability insurance at all, and almost one in three say they are "extremely" unprepared for a three-month disability. It leaves about 1

0 million American women in serious financial danger if they temporarily lose their income.

In this article:

Why are so many single women underinsured?

The problem is not surprising, according to Emma Johnson, a longtime financial journalist and founder of Wealthy Single Mommy, which helps single mothers navigate their careers and finances. "Americans are generally prepared for the economic downturn of a disability – and single women even more so. The paradox is that although single women – especially single mothers – can benefit from disability insurance more than others, they are less likely to have it.

Carol Harnett, Chair of the Council for Disability Awareness, agrees. “We have always known that women had higher disabilities throughout their careers than men, excluding pregnancy. But we were surprised to see how few single women have disability insurance or other forms of income protection, or thought they would get it.

For Johnson, the reasons are understandable. “Disability insurance costs money, and / or is an advantage of full-time employment, both of which are more difficult to obtain when you are a single parent. The chance of needing disability insurance is greater than needing life insurance – even fewer have this coverage. "

The numbers support her. According to the Social Security Administration, 25% of today's 20-year-olds will be disabled before they reach retirement age and 13% will die before they reach retirement. Although there is clearly a silver lining in that statistic – we would rather not die either – it means that you may want to consider moving disability insurance up on your priority list. perhaps even more so for single parents making a financial plan, as the need to support your child if you are not nearby is obvious. It's a good idea, but Johnson recommends that you also add disability insurance to the mix – if only to give you more peace of mind.

“Disability insurance can help protect your family if you are unable to work. Even if you never need it, it releases the peace of mind it gives you energy you can use to grow other parts of your life: career, family time, health, relationships. "

" The chance of needing disability insurance is greater than needing life insurance – even fewer have this coverage.

—Emma Johnson, Founder of Wealthy Single Mommy

Harnett puts it even more bluntly, saying “If you are a single woman and do not have disability insurance through your employer or private insurance, you need an income protection plan in place.

Timing is everything

Insurance is usually not the most exciting purchase in the world (although we are working on it). With a million things to buy and bills to pay on a limited budget, disability insurance can be pushed back. We understand that.

But now it does not matter how careful you are, things happen and diseases and injuries rarely wait until you are ready for them. One of the most common questions we get from potential customers is whether Haven Disability will provide benefits if someone is out of work due to an illness or upcoming surgery. Although in many cases the answer would have been yes, it is unfortunately too late at that time. You must have coverage in place in advance.

"If you are a single woman and do not have disability insurance through your employer or private insurance, you must introduce an income protection plan."

—Carol Harnett, Chair of the Council for Disability Awareness

How Much Disability Insurance Does Single Parents Need?

This will not be the same for everyone, so it really depends on your situation. In general, most short-term disability insurance policies cover about 60% of your income. For some, it is enough to cover the basic necessities, such as rent and car payments, groceries and tools. For others, the thought of getting a pay cut of 40% could be a terrible opportunity.

The good news is that if you buy individual disability insurance with money after tax (for example, Haven Disability) you won the disability benefits you receive. is not subject to income tax. This means that a monthly benefit of 60% can come closer to your current home salary than you can expect.

If you have invalidity protection through your employer, the invalidity benefits you receive are likely to be subject to income tax. If the coverage amount is 60% of your income, you may feel the pinch even more after the taxes have been withheld.

Johnson recommends that you read your insurance information carefully and supplement your coverage if necessary. "Even if your employer offers disability insurance, you may want to read the fine print to understand if it makes sense to buy more to help you live up to your basic cost of living in the event of an injury or illness."

How much does disability insurance cost?

There is no clear answer as to how much the disability insurance costs. The rule of thumb for both short- and long-term disability insurance is between 1-3% of your salary, but the actual amount you pay for disability protection varies depending on your age, occupation, health status and the options you choose.

With Haven Disability, you can choose a monthly benefit from $ 500- $ 5,000 / month, with a maximum of 60% of your gross income. The higher the monthly benefit, the more you get each month if your disability claim is approved, but the price also rises. If your budget is tight, you may want to consider choosing enough to cover your significant expenses.

Time is a resource that most single parents just do not have, so we have made it as quick and easy as possible to see how much disability coverage will cost. You can get a quote for disability insurance in 7 questions and then adjust the options to fine-tune the coverage for your needs and budget.

Our Editorial Policy

Haven Disability is a short-term disability insurance (ICC20-HLSTDI-POL) issued by the Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111-0001 and offered exclusively by Haven Life Insurance Agency, LLC. Policy and rider form numbers and features may vary by state and may not be available in all states. Our agency's license number in Arkansas is 100139527. See important information about policy exceptions and limitations. For costs and complete coverage information contact (855) 950-1395 or visit us online at https://disability.havenlife.com.

Our Editorial Policy

Haven Life is a customer-centric life insurance company supported and wholly owned by the Massachusetts Mutual Life Insurance Company (MassMutual). We believe that navigation decisions about life insurance, your personal finances and overall well-being can be refreshingly easy.

Our content is created for educational purposes only. Haven Life does not support the companies, products, services or strategies discussed here, but we hope they can make your life a little less difficult if they suit your situation.

Haven Life is not authorized to provide tax, legal or investment advice. This material is not intended to provide and should not be relied upon for tax, legal or investment advice. Individuals are encouraged to consult their own taxes or attorneys.

Our information

Haven Term is a life insurance policy (DTC and ICC17DTC in certain states, including NC) issued by the Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111-0001 and is offered exclusively through Haven Life Insurance Agency, LLC. In NY, Haven Term is DTC-NY 1017. In CA, Haven Term is DTC-CA 042017. Haven Term Simplified is a simplified life insurance policy (ICC19PCM-SI 0819 in certain states, including NC) issued by C.M. Life Insurance Company, Enfield, CT 06082. Insurance numbers and driver's license numbers and features may vary by state and may not be available in all states. Our agency's license number in California is OK71922 and in Arkansas 100139527.

MassMutual is rated by A.M. Best companies like A ++ (Superior; Top category of 15). The rating is from Aril 1, 2020 and may change. MassMutual has received various ratings from other rating agencies.

Haven Life Plus (Plus) is the marketing name of the Plus Rider, which is part of the Haven Term policy and offers access to additional services and benefits free of charge or at a discount. The rider is not available in all states and is subject to change at any time. Neither Haven Life nor MassMutual are responsible for the provision of the benefits and services made available under Plus Rider, which are provided by third party providers (partners). For more information about Haven Life Plus, visit: https://havenlife.com/plus.html

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