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As a dentist client’s practice started to grow, I recommended that she purchase disability income insurance policy to protect her future earnings. She and her partner developed a successful practice in northern New Jersey. Then, a health issue developed which caused a tremor in her hands and, just like that, she was no longer able to practice; her career was over in an instant.
Fortunately, the disability insurance that she acquired began paying her monthly benefits, and she was able to keep her home, her savings, and maintain her accustomed lifestyle. What’s more, she is able to work and earn an income as a dental hygienist but continues to receive the monthly insurance benefits since she cannot practice dentistry.
Another client was living with a disability when she found herself getting divorced. She needed to insure her only source of income: alimony payments from her ex-husband, so she purchased a life insurance policy on his life. He unexpectedly passed away 6 years later at a fairly young age, and today, almost 20 years later, she is still living on the life insurance proceeds that were paid to her from the life insurance policy proceeds. Without that policy, she would have very little income and no means to increase her earnings.
The moment that you need insurance is also the moment when you can no longer get it. Protecting the wealth you have already created, and will create in the future, is critical to a sound financial plan. Without protection from the unexpected, your wealth could evaporate quickly. Disability income insurance, life insurance, and long-term care insurance are critical pieces to a balanced plan. However, by utilizing creative techniques and strategies, the costs and tax impact of protection could be much less than expected.