How to Protect Your Income

Written By C.E. "Bud" Smith

It’s easy to pretend accidents or ailments don’t happen, but the odds aren’t exactly in your favor. In fact, per the U.S. Social Security Administration, around one in four 20-year-olds will become disabled before they retire. That’s a scary stat, but there’s a way to at least set up a safety net. Long-term and short-term disability insurance protects your paycheck — and by extension, your family — if you can’t work due to illness or injury. 

How Does Disability Insurance Work?

There are actually two types of disability insurance. Short-term disability insurance replaces a portion of your paycheck for a short period of time. Think three to six months. Most people get STDI through their employer. You can get an individual policy through some private insurers, but these plans generally cost more than they’re worth. 

Long-term disability insurance (LTD), on the other hand, provides coverage if you’re out of work for a longer period of time. Think years or even decades. It, too, is sometimes offered by employers, but the benefit is less common. Plus, the coverage is often inadequate. That’s why people often take out supplemental LTD policies. You can also take out an individual long-term disability policy if the benefit isn’t provided by your employer. Policies generally fall into two buckets: 

  • Own occupation disability insurance:This policy defines a disability as the inability to work at your regular occupation, even if you still might be able to work at another occupation. For example, a surgeon with hand tremors who takes a job as a medical school lecturer would be eligible for benefits under an own occupation policy because he can’t perform the duties of his own occupation.

  • Any occupation disability insurance:To qualify as disabled under this policy, you must be unable to work at any occupation. This is a harder policy to claim benefits from, but it’s also usually less expensive than an own occupation policy.

Learn more about different features of long-term disability policies.

C.E. "Bud" Smith

C.E. "Bud" Smith began his career as an insurance producer for Massachusetts Mutual in 1968, working with individuals in the areas of estate planning and life insurance. Today, he serves as president of The Smith Organization and an owner in Lion Street, a national independent financial and insurance advisory firm.  He works with successful families and their companies in crafting sophisticated financial solutions to help grow and protect their wealth.  He also works with the companies of these families in constructing creative executive benefit plans.

He attended the University of North Carolina, where he studied political science and is a member of The Chancellor's Club.  He received his BBA from Georgia State University in 1968. Mr. Smith is a CLU and has achieved the MassMutual Masters Club status, Top of the Table, 25 Million Dollar Forum and lifetime member of MDRT. He currently holds his Series 65, Series 6 and Series 63 securities licencses.

Mr. Smith is a member of First Presbyterian Church in Atlanta and diligently works in fund raising for the National Parkinson's Foundation. He enjoys golfing, running and reading. He lives in Atlanta and has two sons - C.E., IV, who is a neuroradiologist in Nashville and Tyler, who is a successful insurance advisor specializing in disability income for The Smith Organization.

https://www.smithorg.com
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