1. Emergency Fund
2. Life Insurance
3. Umbrella Insurance
4. Disability Insurance
What happens if you get injured and can no longer work? Especially if you’re in a high paying profession that requires a physical skill (such as a surgeon), you need disability insurance. Even if you are a knowledge worker, there is still a risk that you could be injured and not able to work effectively. Disability insurance helps ensure your quality of life will not suffer too much if that occurs.
There are many types of disability insurance policies available at a range of costs. Some cover you for only the short term, while you rehabilitate. Some long term disability insurance can literally help you avoid financial ruin, as it can pay for your living expenses if you can’t work. Some larger employers may also offer group disability plans at favorable rates that you can often pay through a payroll deduction. In some cases, if the coverage is too low, you can purchase additional coverage.