Why you may need retirement insurance

LOS ANGELES Research shows nearly one out of every three employees will suffer a disability that'll keep them sidelined for three months or longer at some point in their career. Also, experts say it will take about 80 percent of your present annual income to retire. Those are reasons enough to take a look at retirement insurance.

Dr. Scot Glasberg constantly worries about his patients' health, and he doesn't take his family's financial health lightly either. So he stashes away as much as possible for retirement.

"It's incredibly important to plan for the future. What might seem like 30 or 40 years away comes up a lot quicker than people want to admit," said Dr. Glasberg.

But what if he's suddenly disabled? Dr. Glasberg says it's frightening to think about.

"It's a constant fear, because if I can't work, there's no one else who's going to be able to provide," said Dr. Glasberg.

Dr. Glasberg has long-term disability insurance, but it will only go so far. Policies typically cover up to 60 percent of lost income. Certified financial planners like Lawrence Keller warn that once regular bills are paid, there's often nothing left to sock away for retirement.

"It can be extremely devastating from a financial planning perspective," said Keller.

That's why Dr. Glasberg and an increasing number of people are looking into retirement insurance contribution protection.

"It allows someone that's saving towards retirement to protect against the possibility that if they get disabled in the future and are unable to work, that they would be able to have future money set aside," said Dave Evans from the Independent Insurance Agents & Brokers of America (IIABA).

Some employers offer policies, or you can get one on your own through a handful of insurance companies. It may be a rider to your disability insurance, or a separate policy. In most cases, you must already contribute to a retirement plan such as a 401(k) or IRA. If you're disabled, the money goes into your account or a trust in your name.

"It's not cheap - nothing's cheap - but it was not as costly as I thought it was going to be and that was a huge factor," said Dr. Glasberg.

Premiums vary depending on factors like age, job description and - generally - the percentage of salary you put into your retirement account the previous twelve months.

Dr. Glasberg is still weighing his options, but believes he's ready to take a shot.

"Financial peace of mind is what it's all about," said Dr. Glasberg.

The experts who spoke with Eyewitness News says before considering a policy, you should talk with a retirement specialist to assess your needs. If you want a policy, get several quotes, and read the fine print to make sure you know what you're getting.

Companies that offer retirement insurance policies and other helpful information:

Other helpful information:

According to the IIABA, along with CFP Lawrence Keller, several types of defined contribution plans apply for protection, including money purchase plans, profit sharing plans, Simplified Employee Pensions (SEPs), Employee Stock Option Plans (ESOPs), 401(k), 457 and 403(b) plans, SARSEP plans, traditional and Roth IRAs, simple plans and Keogh plans.


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