Today on Radical Personal Finance, it's Financial Planning Wednesday, and we're going to round out the Disability Income Insurance series. This will be the fifth episode in this series. We're going to talk about taxation of premiums and benefits of disability policies. We're going to talk about various different types of disability policies that you can buy.

Some of these you'll be familiar with and some of them you will have never heard of. And also I'm going to answer your questions, answer all of the listener questions that came in about Disability Income Insurance. Welcome to Radical Personal Finance, the show dedicated to providing you with the knowledge, skills, insight, and encouragement you need to live a rich and meaningful life now while building a plan for financial freedom in 10 years or less.

My name is Joshua Sheets and I'm your host. Thank you for being with me. Today, we work on that avoiding catastrophe category where we talk about insurance and try to pull back the curtains of the disability world yet again. This episode is the fifth in this Disability Income Insurance series that we began quite a while ago.

Episode 337 was the first. That one was entitled "Why You Should Buy Disability Income Insurance Before Any Other Type of Insurance Coverage." That was the sales job that I needed to do on why you should really focus on disability insurance. Next, we covered in episode 339, long-term disability versus short-term disability and I explained why they both can be useful but I spend most of my time with regard to financial planning talking about long-term disability.

We also discussed various benefit periods, elimination periods, and certain contract terminology such as non-cancellable versus guaranteed renewable for the continuance provisions to understand why these make a difference in your life. Then we went on to episode 340. That was a Q&A show where I answered should I get a couple of questions on disability insurance.

354 where I talked about different benefit amounts for disability insurance, how to do a needs analysis, group insurance versus individual insurance, various definitions of disability such as own occupation versus any occupation, and then different policy provisions that you need to be aware of, total disability, partial disability, etc. So with these episodes, I guess this is the fourth in the series plus the Q&A.

With these episodes, I think I've laid a pretty good groundwork for you with regard to the terms of disability insurance. Today, we're going to round it out with a discussion of taxation of policies. We're going to explain that to you, how these policies are taxed. I'm going to go through some of the different types of disability insurance that are not so common, not so popular.

Then I had various questions that came in from the audience on disability insurance. I'm going to answer these questions in today's podcast. So I hope you enjoy this. This should round out the disability portion. I think that with the conclusion of this show, I have finished everything that's on the CFP exam with regard to disability insurance.

Disability is a relatively small area of focus, and so it's relatively easy to be able to dig into and cover everything with regard to disability. Before I start today's content, quick sponsor of the day today, number one, is Paladin Registry. Paladin Registry is my solution for you for where you can go to find a good financial advisor.

Now, disappointingly, the advisors that you get here are not necessarily always insurance experts. They should be qualified and credentialed advisors. They should be able to work with you in the areas of insurance or at least be able to give you some input in that area. But they're not necessarily insurance people.

They're investment people primarily. I've worked to try to figure out a solution for being able to give referrals for you guys to good insurance companies. I haven't figured it out yet. When I can make that happen, I'll bring that to you. But if you're looking for a financial advisor, a financial planner who can look at disability insurance among everything else, start your search with Paladin Registry.

Paladin Registry is a registry service. So what happens is that individual financial advisors come to the company. They apply to be part of the program. Paladin researches them, researches their disciplinary records, takes a look at their practice models, et cetera. And then if they get approved, then they list them in the registry service.

The way that you get connected is go to radicalpersonalfinance.com/paladin, P-A-L-A-D-I-N, radicalpersonalfinance.com/paladin. And that will forward you through to a landing page where you put in your name, your address, your info, the amount of assets that you have to manage, all that information. They'll take that. They'll filter it against the criteria of their advisors.

And that's why it's important that you put the information that's there. I don't think it's overly onerous to put that information, but you need to do it accurately so they can connect you with an advisor who will work with you. If you're just getting started and you've got $50,000 of investable assets, then they've got to screen you out from the people who are working with million-dollar minimums.

If you've got millions of dollars, you've got to put that in there so they screen you out of the people who are not focused on your type of situation. So fill in that info there and they'll connect you with a few different advisors who will reach out to you.

You can schedule an appointment, see if any of them will be a good fit for you to be able to find a good financial advisor, radicalpersonalfinance.com/paladin. Also quickly, I've been doing a few more consulting calls. If you would like to get my input directly on your situation, I'd be happy to offer a consulting phone call to you.

All the details of that can be found at radicalpersonalfinance.com/phonecall. Now, let's dig into it. First thing I want to talk about is taxation of premiums and benefits for individual disability insurance. To begin, let me explain the basic concept that you need to know, which is simple. You're going to get taxed either on the way in or on the way out.

In many cases, you get to choose. When it comes to insurance benefits, the Internal Revenue Code is relatively consistent. You've got to pay tax somewhere and you get to choose where. So what I mean is you either can take and deduct the premium up front and then the benefit will be taxable to you, or you can not be able to take a deduction on the premium up front and you can receive the benefit on the back end without any taxation, without any income taxation.

There are a few exceptions to this general rule, but for the most part, just remember the rule. You can either take a deduction up front and not get the benefit tax-free, or you can pay the tax up front and get the benefit tax-free. So the way this works with disability insurance is relatively simple.

If I own an individual disability insurance policy and I'm paying for it out of my own personal pocket, paying for it out of my checking account, well, that's not going to be a deductible expense for me. I'm just going to pay for that premium using after-income tax dollars. But if I were to become disabled, then at that point in time, I would receive the benefit income tax-free.

So that's fairly simple for individuals who are going to just buy something themselves in their own individual bank account. But what about the situation for those of you who own businesses or what if you're getting benefits as an employee? Well, again, the key is just to remember who owns the contract and who's getting the tax deduction.

So if you as an employee own a disability insurance contract and you're paying the premium for that contract, then the premiums are not deductible up front, but the benefits are going to be tax-free on the back end. If on the flip side, however, you as an employee own the contract, but the employer pays the premium under a salary continuation plan, then that premium will be deductible by the employer, but the benefit will be taxable to you.

So the key difference here – and this is where it gets a little complicated. If you don't need to deal with this for your situation, just tune me out for a couple of minutes and we'll be done with taxation. But there's a big difference when you're setting up in group benefit plans whether the disability policy is being offered under some sort of a bonus arrangement, under a section 162 plan or under a salary continuation plan.

If the employee owns the contract and the employer pays the whole premium under a bonus arrangement like in a section 162 disability insurance plan, then the premiums are deductible by the employer as a bonus and the benefits are tax-free to the employee. So you can set this up a little bit different.

But in general, if the employer is paying for it, then the benefit is going to be taxable to you. If you're paying for it and it's not deductible, then the benefit is going to be received tax-free. If you get into a situation where you get into an option where there are partnerships or S-corporation shareholders, then it gets even more complicated.

It is possible that a partnership or an S-corporation can deduct the premiums that are being paid in order to get coverage for a partner in a partnership or for an S-corporation with somebody who has more than 2 percent of the shares in an S-corporation as a deductible business expense.

That deduction is basically the idea is that the premium cost is being included in the taxable income of the partner or shareholder and then at that point in time, the proceeds because they've been included as income and taxed there, the proceeds would be excludable from taxable income. So basically what you need to remember is simply that if you're deducting it up front, the benefit is going to be taxable.

If you're not deducting it, then the benefit is going to be tax-free. Now let me just go real quick. I had a question on this. So this is one of the questions that came in from a listener named Dan. "Joshua, my employer provides a generous disability coverage and gives employees two options.

One, pay the tax on the benefit cost and receive disability payments tax-free. Two, do not pay the tax, making the disability payments taxable on receipt. I am a physician in the highest income tax bracket in California, but I've been encouraged to pay the relatively small amount of tax on this benefit for the potentially larger tax-free income if disability occurs.

Does this make sense? Thanks, Dan." So Dan, the answer to this question is that probably it does make sense for you to go ahead and pay the tax on the premium and include it in your after-tax income so that you can receive the benefit tax-free. I can't prove this one way or the other.

I really can't prove it. And it would be great to go ahead and somehow be able to switch it if you knew you were going to be disabled. But the potential impact, especially if you're a physician and you're receiving large amounts of disability benefit revenue if you became disabled, by receiving that money tax-free, the tax savings on that could be very substantial.

It really could be. So in general, I've encouraged people just to say pick it up and pay the – use after-tax dollars now and receive the income tax-free on the back end. I do think it would be wise to, as always, run some numbers in your situation because if your premiums are very high and if you can use that deduction now and it would be advantageous to you, and if you look at the benefits and say, "Well, if I did receive the benefits, how much would that be?" I think it's worth doing some math because sometimes some of these policies can get extremely high in terms of their premium cost and that deduction can be very, very useful, recognizing that that deduction is going to be a deduction that's applicable at your highest marginal bracket.

But you need to look at it and run the numbers both ways. In general, if I have to give you a generalized answer, I say go ahead and pick up the income, pay the income tax now and get the benefit tax-free. But I understand why people go the other way.

So that's the basics of how the taxation works of disability income insurance policies. Remember that theme when you get to other aspects of types of insurance because that's a consistent theme that really goes most of the way through with insurance policies and with the revenue code to understand how it works.

Let's talk about a few different types of disability insurance products that you may like to be aware of. First, we've mentioned continually here individual disability insurance. And I talked about short-term disability insurance and long-term disability insurance. You can purchase these products in the individual marketplace and make sure that you understand that it's basically up to you to solve the needs that you actually have.

As a financial planner, I think generally it's easier to self-insure for the short-term needs and then to pick up the risk with an insurance policy for the long-term needs. But you can buy – as an individual, you can buy various short-term disability products in the marketplace and you can buy long-term disability products as well.

One of the interesting aspects to this is different companies offer some different riders. And it's very important when making disability insurance decisions that you're working with somebody who's knowledgeable in this area who can look at your situation and can figure out what the benefits are for you. Let me give you an example.

I think I touched on this in a previous episode but I wasn't sure so I made a note to talk about it here as well. There is an option that you can buy with disability insurance. It's called a social insurance substitute benefit, SISB. And what this works is it's a way of the insurance company transferring some of their risk from the company over to social security.

And the reason I think this is valuable is because when I used to work with people who were in the blue-collar professions and in the trades, because these types of jobs – let's say you're an electrician or a plumber. Because these types of jobs bear with them a larger risk of disability due to accident or injury than does a white-collar sitting behind a desk job, the cost of the premiums is substantially more.

But I don't think that means that there's any less need for the insurance. But what it does mean is often it was harder to fit these premiums into a blue-collar worker's financial situation than a white-collar worker's financial situation. If you have the benefit of working with somebody who's working in a professional job earning $150,000 a year and their disability is very inexpensive because they're in great shape and they're working in office, it's not hard to fit 50 or 100 or $150 a month of premiums into that type of budget.

But if you're working with a tradesperson who's earning say $60,000 or $70,000 a year and who is on a job and they know how easily they could be hurt and all of a sudden now the premiums are much more, it's a little harder to fit that in. So you've got to make insurance plans fit the budget of the prospective insured.

There are a few ways that you do that. One is that what you often do is you often pull back on the benefit period a little bit. Where you go from instead of offering a benefit period from 65 or 70, you pull it back to something like a five-year benefit period.

That'll make a big difference in the cost of the insurance. You might pull back on the amount a little bit, make sure it's there. You might even stretch out the benefit period. All of these things will help reduce the premiums. It's reducing the coverage but it's reducing the premiums.

But often it's still too expensive. One way that I used to solve this is by using what's called the social insurance substitute benefit. The way it works is in general if you're buying just straight disability insurance from a company, nothing keeps you from applying to Social Security and receiving Social Security disability if you qualify.

Much harder to qualify for Social Security disability but there's nothing that stops you from applying for it. So if you had a $4,000 a month benefit from your insurance company and if you're able to get $1,000 a month from Social Security, you'd get $5,000. It would be add on top.

The way social insurance substitute benefit works is in the contract language from the disability insurance company, there's a clause that reads that you will apply for Social Security. If you're not approved by Social Security, then the insurance company will pay out the benefits based upon the terms of the contract.

But if you are approved by Social Security, they will reduce the amount of your benefit based upon the amount of your Social Security benefit. So if the same client had a $4,000 a month policy but they were receiving $1,000 a month from Social Security because they were very disabled, then that would cut their benefit from the insurance company to $3,000 but they would still be getting the $1,000 a month from Social Security.

So sometimes these riders can be very, very helpful if you understand them. And because disability insurance is so difficult to compare in a direct way, it's not like lining up a straight 20-year level term policy among five companies and just picking the cheapest. You've got to pick all these different options.

That's why you need to work with someone who understands the riders because these tools in the hands of the insurance agent can be useful to get the premium down. Don't ever be scared when working with an insurance agent to speak clearly and directly and figure out how to get the premiums to a manageable level.

Often it seems like people are fearful of this. But you need to first decide, "Do I want or need the insurance coverage?" If the answer to that is yes, because you want it or because you need it based upon a needs analysis, then you've got to figure out how to make it work within your budget.

And it's not like there's necessarily magic. The insurance costs what insurance costs. Remember, these things are all invented and designed by actuaries. And so it's very difficult to get – people have this idea of insurance that somehow there's tons of money and you just got to shop around. Remember, you do need to shop around.

But remember, the actuaries are working and they're trying to be competitive in many markets as long as this company is trying to compete in this market. They're working to figure out how do they do it and they're just making different assumptions. So you're not getting better insurance by getting cheaper insurance.

You're just getting insurance that costs less but has less benefits. But you can still solve the bulk of your problems and hedge against the risk even while getting the premium down cheaper to a level. You always got to decide. Do I go all the way with insurance? Do I go halfway or do I get just the bare minimum?

One of the riders that I wanted to mention here and this is what – to introduce the topic of riders was there are different riders that you can use to enhance the benefits of a policy on the backend as well. There's a rider that you should be aware of called the retirement protection rider.

Different companies will have different names for it. But some policies, you can buy this rider where it will set aside and provide for you retirement funds if you get disabled for the rest of your life. One of the biggest costs of disability is the lost time and money to compound for retirement goals.

Let's say that you were very careful with your finances and you were diligently working the job, diligently putting money into your 401(k). You were planning for retirement. But then you get disabled and you don't have disability insurance. Well, remember there are two costs to that. First is the current cost, the fact that how do I earn my income now?

You start using savings. But the other cost is what about the money that I was going to be putting into my retirement accounts and it was going to be growing early on in my career? Retirement accounts don't get funded. You don't get your 401(k) match when you are disabled.

So you can get these riders that will put an option on there where some of them, they'll set aside a trust account for you. Some of them, they'll make additional contributions. But you'll get a rider here where it will set aside and set aside a retirement fund for you.

So if you're up in the upper income limits or you're looking at this, you should consider the value of that. You should price it. You should see what the benefits are and consider that. While I'm on the topic of riders, one of the other things that I wanted to mention was the process of getting insurance if you have trouble, if you have some kind of medical condition.

Life insurance underwriting is based upon the chances and the likelihood of your dying. So it seems obvious but that's how it works. So you can have all kinds of medical conditions. But if they don't lead to a statistically expected shorter lifespan, they're not going to impact your chances of – they're not going to impact your life insurance underwriting.

You can have what seems like a very minor medical condition. But if it seems like it might lead to some chance of dying, that will significantly impact your medical – your underwriting for life insurance. Here's an example of what seems like minor. I used to work with people and sometimes somebody had questions.

They would have trouble sleeping and I had one client. He went to see a sleep doctor. They diagnosed him with sleep apnea and they recommended that he use a CPAP machine. Well this client said it was ridiculous. I don't have sleep apnea. It was a bad test. Never took the advice.

Never did anything with it. We went to apply for life insurance and it became a significant problem. We wound up with a significant cost to him for his life insurance because of the diagnosis of having sleep apnea. The medical underwriter, when you apply for insurance, will go through your medical records and they will go based upon what your doctor says.

Well, sleep apnea bears with it a significantly increased chance of dying in the middle of your – while you're sleeping. So that will have this person totally normal, totally healthy. No, I don't have any health conditions but a condition like sleep apnea does have a significant influence on your ability to get life insurance.

So this happens quite a bit. On the other hand, you might have people and I can't come up with an example off the top of my head but I know I have people say I have this, I have that, I have this other thing. Examples like high blood pressure or cholesterol problems, things like that.

There will be many people who said, "Well, I've got these problems," but often you can get it in and as long as those conditions are stabilized and they've been stabilized and controlled with medication, you get standard rates or standard plus rates or preferred rates of some kind. The reason is that the underwriters, they get very nervous about things that are recently changing.

If you were just put on blood pressure medicine, that's going to have an impact. But if you've been on blood pressure medicine for 10 years and there's a good record there, well then chances are it's not going to affect your underwriting rates. So the underwriters get concerned about things that are moving but if things are well controlled and your medical history is clear, that might not result in any changed rates.

With life insurance, the way that risks are handled is based upon changes in the premium because they can't exclude anything. If you die, they've got to pay it out. So they adjust things based upon the premium. They adjust it based upon a ratings classification. So you get to standard rates or preferred rates or you get tables, they call them a tabled rating.

So with a company, it might be preferred, then standard plus, then standard, then table one, table two, table three. Each of those comes with a rating adjustment where you're going to pay more money for it. But what you also get is you get another system where they'll add what they call a flat extra.

This is common if you have a hobby or something that bears with at risk. You're racing cars, you're a private pilot, you're flying airplanes, you're doing experimental scuba dives, things like that or deep depth scuba dives. They'll put on a $3 flat extra, which means for every $1,000 of insurance, they'll add $3 of annual premium.

So if you had a $100,000 policy, then that's 100 times three and so you'll pay an extra $300 per year for your premium because they have what's called a flat extra. And sometimes on life insurance, those flat extras will be removed. They'll say, "We're going to add a flat extra for this medical condition for X number of years and then you can come back in and we're willing to remove that from the policy with a good medical history." So that's the way it works with life insurance.

They adjust the premiums because they can't adjust the benefits. With disability insurance, however, they will add riders, which will exclude certain causes of disability. So first let's talk about what disability insurance underwriters find problems with. They find problems with things that are likely to affect your work. So you might have something like carpal tunnel syndrome.

Carpal tunnel syndrome is not life threatening. It's not going to make any difference with your life insurance underwriting, but it could potentially make a very big difference for your disability insurance underwriting if you're a computer programmer. So it's all the medical conditions that you have to worry about go down to not what's going to kill you, but rather what's going to make you sick, what's likely to cause you not to be able to work.

Something like back pain becomes a huge deal for disability insurance underwriting, where for life insurance, okay, you've got back pain and you're taking a medication to help you with it. No big deal. If your back pain is not connected to it, something that's going to kill you, we don't care how miserable you feel.

We just don't care, but we don't care how miserable you feel. We just don't want you to die. With disability insurance, we care about that back pain. So with disability insurance, because it's not so cut and dried, meaning life or death, death certificate or not, they will give you the option of issuing the insurance policy, even if you have a medical condition, and sometimes they'll adjust rates just like they do with life insurance.

They'll charge you additional cost or add some kind of flat extra cost to it, but sometimes what they'll do is they'll offer you a policy with an exclusion rider. They'll say, "Okay, we noticed that you have carpal tunnel syndrome. We're willing to issue you the disability insurance policy, and we'll cover you for any disability except a disability that's related to your carpal tunnel syndrome and your repetitive strain injury." Or "We noticed that you have back pain.

We'll cover you for anything, any kind of cause of disability except for this back pain that you have." And sometimes this will come with a certain number of years where the underwriter will say, "We'll cover it except in the first three years," or it'll just be on there as a permanent exclusion rider.

So you should pay attention. You should talk about those things and look into those things. Again, this is why it's so important. If you are going to get insurance, get it before you think you need it because most people don't start thinking about repetitive strain injury and carpal tunnel when they're just normally typing and they're making their work.

But I've had two family members who have been disabled due to repetitive strain injury, unable to use a computer, unable to click a mouse without significant pain. And so these things make a big difference over time. Little bit of a sidetrack from my types of disability, but those were just a couple of additional thoughts that I hadn't covered previous in the series I wanted you to have.

So we talked about individual disability, long-term, short-term. There's also obviously group disability income insurance. And if you need disability insurance but you can't get it as an individual, you should consider looking into seeing if you can get it within the context of a group. When you sign up for group benefits, and if you are a person who has health issues or has disability problems, you should seriously consider working at a company where the group benefits are strong.

Now their HR coordinator won't like this because it'll mess up their rates if they have a bunch of sick people working there. It'll mess up their rates with the insurance company, but that won't be a problem to you. And you can get in on a disability contract on a group basis where you might have been excluded on an individual basis because of that individual medical underwriting.

There are also opportunities where you can get what are called multi-life policies, list bill or simplified issue individual disability plans. And if you run a small business or run a small company or if you have partners, you should talk with your insurance agent about the options of a multi-life discount or a simplified issue plan.

Some companies are very competitive in these smaller market opportunities. Some companies, they do big group insurance. They want 3,000 enrollees and that's where they specialize. Some companies are really specialized on individual policies. But then there are companies who work hard to get this 2 to 10 or 10 to 30 or this type of range of disability contract.

And sometimes if you have some kind of questionable situation, it's not just if you have a questionable situation, these things can save you money as well. But you can talk with an insurance agent and you might be able to put in place a plan for everybody in the company.

Also often, you should ask about the possibility of a multi-life discount when working with your insurance agent. As an insurance agent, this is a benefit. But if you can get or know of multiple people at your company that have their insurance with the same company, you can go ahead and get a discount for that.

So this might be a good reason to send your insurance agent around. Most people need disability insurance. Many people don't have it. And so if you refer them to a few of their friends, they'll make some additional sales but it can come with a substantial discount for you. So that would be a multi-life discount.

You should also ask if you're buying insurance and you're working for a company, you should also ask if other people there have insurance, disability insurance with that company. The insurance agent will not have access because of privacy records. They will not have access to that company to know, okay, you work at ABC Manufacturing.

Hey, I know we've got four other clients there. That's their personal clients where they've actually sold the policies and done the business. They are not going to know that. But you can go ahead and send an email and say, "Hey, does anybody have a policy with this company, an individual disability policy?

I'm trying to get a discount." And if you find maybe three people, two or three, four people, depending on the company's rules, you might be able to get a multi-life discount. You can also get these on a simplified issue basis. And one of the benefits that can come if you can get a few people together is you might be able to get unisex rates and a discount.

Sex ratings for disability insurance are very important. Life insurance for men costs more than life insurance for women by a small margin. When you're doing individual insurance, it's a little bit cheaper for women because women are likely to live for longer. There's a small difference. But women are much more likely to be disabled at an early age than are men for various reasons.

And so the premium difference can be substantial. And I've had a few of these situations where I would work with, say, a couple of attorneys at a law firm. And it was very much in the best interest of the attorneys, especially if I was working with a female attorney.

If I could get a few people at the law firm to get a minimal policy coverage, the discount by getting to either a multi-life situation or a unisex rate was so substantial that it made all the financial sense. And so if you are a – let's say you're a high-power female attorney, a high-power female physician, you should talk to your insurance agent and see maybe if you put some minimal contracts.

And even if you paid for it either out of your company or yourself, if you have a big contract for you, a big expensive contract for you as the high earner, but you go ahead and just put two minimal policy minimum contracts for your employees, you might get a discount that's even substantial enough to where you save yourself the money on – you wind up getting it cheaper by getting it to a unisex rate.

The rate differential for disability insurance between men and women is substantial. So pay attention to that. Guaranteed issue plans can also make a big deal for you. I've had clients especially as a financial advisor if you're working with the principal and the principal has some health conditions, you can go ahead and again bring in if you can get a group of say 10 or more employees.

Even if you're not paying for it or offering as a group benefit, if you can get enough people to participate and you can get in on a guaranteed issue plan, it can help you to cover for a personal medical problem that you might have that you might not have been able to get coverage for.

So just because you can't get disability insurance doesn't mean that you shouldn't necessarily research another way. Talk to a good insurance agent. A good insurance agent might have a creative way to get you coverage. Business overhead expense insurance. Business overhead expense insurance is another way, especially if you're a small business owner that you should consider buying disability insurance.

Sometimes with a business it can be difficult to get and prove financially because with disability insurance you've got to do medical underwriting and financial underwriting. Oftentimes when you're running a business it can be difficult for you to get enough coverage because you might have, especially in the early years, heavy business expenses.

So a business overhead expense policy is designed to keep your business going if you are disabled. It's designed to cover the expenses of your overhead if you are disabled. So this is important because it allows you to keep your business going concern, which is much more valuable to sell in the secondary market, even if you are disabled.

The way these policies work is they come in with a 30 or a 60, 90 day elimination period so they kick in after a relatively short period of time. But they only last for a short period of time. They're usually one or two years at their maximum benefit period.

Two years is usually about the maximum. And so here if I'm running a store and I'm a florist or I'm a, it doesn't really matter, I'm a CPA, just something, and I'm running a business and I've got my rent, I've got my utility costs, I've got my advertising expenses, I've got all these expenses lined up.

If I'm running these things and now if I'm out of business and I'm out for six months or a year, how on earth am I going to be able to cover all of those expenses on an ongoing basis if I'm out of work? It's just probably not going to work.

I'm probably not going to be able to do it at all. And so as a component of this, what you do is you buy this business overhead expense policy and if you become disabled, it'll cover these expenses for you for a year. And that's usually enough time to either say, "Hey, am I going to be back in the business?" In which case you can pick it up and you can get things going again, or "Do I need to get out and either close or sell the business?" So you might need to go ahead and close, but at least you didn't get behind on your lease and have those problems, or you might be able to sell it.

Because you've kept your storefront open, you've kept your advertising going, maybe had a friend or family member step in and do the best they could to keep the business going while you were out, you can go ahead and sell it as a going concern instead of just shuttering it and not having anything valuable to sell.

That's called disability overhead expense or business overhead expense. Very very useful insurance policy to be aware of. Next, there is buy-sell insurance, disability buy-sell insurance policies that you can buy to fund a buy-sell agreement in the event of a disability. Now to explain what a buy-sell agreement is, if you and I are in business together and you and I are just say we're partners for the moment, doesn't really matter whether we're shareholders in a corporation or whether we're partners, just assume that we're business partners.

We're tied in together and one of the most important aspects of business advice that you need to think through carefully when you are establishing a partnership is what's the exit plan from this partnership? Because when you and I are getting into business together, we're getting into business together because we think that each of us brings something to the table that's going to be helpful.

We're going to be able to work together and we're going to bring something to the table. But what if I die and now my shares and my ownership of the business now go to my wife? Well you're now business partners with my wife. That might work great. My wife is a great woman.

I love her to death. Or it might not work great. You might or might not want to actually be in business with my wife. Probably you don't want that. Probably you got into business because you wanted to be in business with me. So it's important to understand that when you're in a partnership with somebody, what happens to your partner if they die?

What happens to the partnership? Many partnerships just fall apart and this can be a real problem because remember, my shares of ownership, my partnership interest, my member units of our LLC that I own or my shares of stock in the corporation that we're partners in, those shares are going to be passed according to my will to my beneficiaries.

And now those shares come with ownership rights. If I'm 50/50 partners, you now have to make business deals, decisions with my wife according to the terms of our partnership agreement. What happens if I die? What happens if I become disabled? You and I, we build a financial planning firm together and we're doing great.

I'm handling the marketing of it. You're doing the planning of it. And we build this thing bigger and bigger and bigger and we're both doing really well. Now I'm disabled. Well, I can't do the marketing like I planned but I'm also now receiving the benefits of my ownership and my share of the profits.

I'm receiving my share of the profits because I own the business. Now you probably would want me to receive that for a few months. You know, Joshua, he's not doing well. He's got cancer. He's going to get back on his feet. But after a while, you're going to start to feel like you're getting the short end of the stick.

How do we make sure that doesn't happen? This is why when planning for partnerships or when you're in business with somebody, you plan for all the Ds. You plan for death. You plan for disability. What happens in the case of divorce? It's a big one. You and I are partners together.

My wife and I divorce but she's still the beneficiary of my shares and now I die and now you're in business with my ex-wife. You might not like that. What happens in the case of dissolution? You just want to get out. You just sort of just handle all the Ds planning.

How do you escape from a partnership? You know that plan going in. If this doesn't work out, how do we dissolve the partnership? So you can buy a disability insurance policy to fund a buy-sell plan. Most people fund their plans with life insurance and this is important. You and I have a business.

It's worth half a million dollars. I die. You want to buy out my wife. What do you do? You have $250,000 cash sitting there but my wife needs the money. So you buy a life insurance policy on my life or I buy a life insurance policy on your life.

That works out really well because I die. You receive $250,000 from the life insurance policy that you owned on me. You take that $250,000. You buy out my wife. She has $250,000 cash. You have the business. Everybody has what they want. Another episode will cover buy-sell plans in depth.

We'll cover cross-purchase agreements. We'll cover entity purchase agreements. We'll cover taxation because that can work really well. What you received was you received a step-up in tax basis from your units that you bought. My wife received the full value of the company without ever paying income tax on the money – excuse me, without paying tax on the gain.

So this can work out really well because she received – we'll save taxation for another time. But many people fund their partnership agreements, their buy-sell agreements with life insurance. But they don't fund them with disability insurance often. You need to consider it because as I mentioned, if I'm dead, I'm dead and gone.

But what if I'm still alive and what if I'm still – I'm just disabled and I can't contribute very much to the business but I still want my monthly check and I still want to give input on the business? Well, you want to get me out. The problem with this comes in from two reasons.

Number one, the funding problem. Where do we get the money for you to buy me out? We're in business. I'm disabled. I'm fighting cancer. It looks like I'm going to make it but it's really tough. And now you're like, "Listen, Joshua, I love you to death but I can't have you out.

So where do you get the $250,000 to buy me out? I need the money. I'm fighting cancer and you need the business. But how do we get out?" Well, it would be nice if you had a policy there that was set to pay with a lump sum. And these policies, again, they'll work.

And what these will do is they'll have a very long elimination period, maybe a year, maybe two years. You're not going to kick your business partner out after three months of being sick. But after two years of being sick or a year of being sick, you might want to.

And then they come with a lump sum. You can structure them either with a lump sum or a series of payments if you need to. But usually a lump sum would be the best. So if I were disabled, I'm fighting cancer, a year into that thing, the disability policy triggers.

It pays you $250,000. You buy me out for $250,000. I've got the cash. You've got the business. You're happy. Now, the second reason why you want to fund a disability insurance agreement with a life – excuse me, with a disability buyout policy is because it gives you an objective third party who can determine the definition of disability.

And this protects both of our interests. Think about this. If I'm disabled but I'm receiving an income from the business, how much – and I'm not working but I'm still receiving 50 percent of the profits. How much do I want to be out of the business? I'm doing pretty good.

I'm not working. I'm still receiving 50 percent of the profits. I don't want to get rid of my business. I like this. But if I'm disabled and I'm not contributing anymore to the growth of the business and you're picking up all my slack at work, how much do you want to get me out of the business?

Well, financially, you probably want to get me out so you can bring someone else in. Maybe you're going to find someone who's going to fill my role. But you don't want to get me out too much because you know what an impact it's going to make in my life.

After all, we're business partners. You care about me. And so it can become very difficult for partners to figure out, "Are you disabled or are you not disabled? What do we do?" The second big thing that it comes into is how do we determine if you're actually disabled? We set up this legal document between us that's called a buy-sell agreement that triggers that when you're disabled, you're going to be out and I'm going to buy you out.

But how do we know when that's going to happen? And worse yet, who enforces that? So the buy-sell agreement could say, "Well, if Josh was disabled, you got to buy him out. You may not have the money. And how am I going to prove that I'm disabled?" It can be very, very difficult.

So if you're going to have this kind of policy, this kind of agreement in your buy-sell agreement, you should try to get disability insurance for it. And if you can get disability insurance for it, you should make the terms of your legal agreement subject to the terms of your insurance contract.

So you want the contract to come in and to say, "If Josh was disabled according to this disability contract number 12345, then this clause goes into force." And this accomplishes what you need. It accomplishes an external third-party independent who's determining the level of disability and it's making sure that we don't have a legal agreement that says one thing and an insurance agreement that says another.

Because the legal agreement says I'm disabled, but the insurance agreement doesn't pay out. Now you've got no money to pay me. So you make the terms of your legal agreement between you subject to the insurance policy. And then that way, you have that insurance policy. If it triggers, now you have the money to buy out.

You don't want to get in the situation where the legal document triggers the sale, but the insurance policy is not triggered because then you don't have any money. So an disability buyout insurance policy is very, very useful. I've done these with architects, attorneys. You just want to look at it.

And if you're in practice with somebody, think about how this works. And it can work really well to have this set up. It protects for many people the equity of their practice. It's difficult in a professional practice and that's where these are largely used. Because if you have a traditional business, a brick and mortar business, a business that can operate independently of the business partners, oftentimes those businesses can keep going.

Just ask yourself, if I were disabled, how would my business be affected? But if you get into a professional occupation, an attorney, an architect, if I were disabled, that's going to dramatically affect my firm. And yet the value of the firm, the equity, the reputation that you've built, that's a big asset.

It's a hard asset to cash out of. So older professionals try to cash out by bringing in younger partners and doing a buyout over time. So there's a good transition plan and that can work really well. But you need to consider and research these buy-sell plans. Okay, a couple more.

There are some unique things you can sometimes get, impaired risk disability policies. You can get policies for unique occupations. You can get disability policies for athletes. You can get disability policies for entertainers. These are not going to be gotten with a mainstream company, but they can be gotten. These will need to be individually underwritten.

I placed a couple of these policies with a subsidiary of Lloyd's of London. That's where these types of insurance contracts often go where they – I'm going to insure my legs and these actresses. I'm going to insure my lips in case my lips get damaged. My pouty lips are my reputation.

But I had – I worked with one lady who was a TV correspondent and she was an independent freelance TV correspondent. We couldn't get her disability insurance with a mainstream company because they wouldn't cover that occupation. But I could – I did get it with Lloyd's of London with a subsidiary of them.

These are also the companies that you work with if you need a high-excess limit policy. So you reach – you have an occupant, a very high earner. They want to protect their income. You can go ahead and you can get in place a policy with a mainstream company, but they're going to limit their risk.

They're going to stop at 10 or 15. Some of them will go for $25,000 a month. But you can go ahead and get an additional supplemental policy for a much higher amount with another company. So these options out there exist. They exist. If you're in a market like a physician, there's physician excess limits policies where they'll go above the $10,000.

The terms work a little bit different. But those are – if you're a physician, those are widely available. If you're in a more unique, smaller occupation, they're less available. There are also products out there such as key person disability insurance. So most of you have probably heard the idea or the word of key person life insurance.

Let's say that I run a company and I have my star salesperson who's responsible for bringing in 80 percent of my revenues. They're very good. They're very well-known. I pay them handsomely and they bring in 80 percent of our revenues because they've been in this industry forever. Well, that's a key employee for me.

If that person died, I've got a problem. I've got a huge problem as a business owner. So I'll put a key person life insurance policy on that key person. If they die, then I'm going to have a half a million-dollar life insurance policy payout. That will help me to have enough money coming in to where I can handle the financial shortfall I'm going to have for the next few years until I can raise up another – raise up or train another salesperson.

Very important. You can also purchase key person disability insurance and it does the same thing. Again, my star salesperson gets cancer. We feel really sorry for Joe. We try to help Joe as much as we can. But at some point in time, we got to figure out what we're going to do.

If Joe can't service his accounts, we got a problem. So you can purchase a key person disability insurance policy that will protect you and remunerate you for the loss of Joe's services. Finally, you can cover disability – you can get disability and policies to insure a bank loan in the same way that you can get life insurance to satisfy that.

If I owed you a lot of money, you might want to have a life insurance policy on my life if I die and I can't pay or if I get disabled. Then there's also – I've seen a few companies that have worked in the area of divorce settlements. Same thing.

If you're reliant on alimony and child support payments and the divorced spouse becomes disabled, that can be a real problem to your alimony and child support payments. So you can get a disability policy that can put that in place and you can put in place a policy that will – you can make that part of the divorce settlement.

A good divorce attorney usually handles these things but in general, you often want to make sure that there is life insurance and potentially disability insurance that's protecting you in case of the death or disability of your spouse. All right. That covers most of the things that I wanted to cover here.

Just the final thing. Let's see. Questions. Joshua, I heard one of the podcasts where you mentioned you're going to be doing a series on disability insurance next week. I have a couple of questions to contribute. Number one, can you get disability income insurance if you don't have a job?

I do a variety of things to make money but often on a project basis or just as they come up and sound interesting to me. My income isn't very predictable but my expenses are really low. So it works fine as long as I'm healthy. But it wouldn't if I were hospitalized or indefinitely incapacitated.

Answer to this question is probably not. Possibly but probably not. Now, depending on how you have these things structured in terms of your personal activities, that will drive the answer. When you say I do a variety of things to make money but often on a project basis or just as they come up, if that's – I have a couple of different jobs with employers.

I'm an employee for – let's just make up some occupations here. I'm a photographer and I work part-time as a photographer and then I also do DJ work and I help a DJ as their employee and I'm a rodeo clown and I have a real estate license. So I do those four things.

Well, you're not going to be able to get disability insurance and the reason is because in the contracts, you're not going to be able to prove that you do it for enough time. There are limits. I forget what the limits are. I think something like 10 hours. You got to be working at least 15, 10, 15, 20 hours a week in an occupation for it to be considered.

So if you're just doing eight hours as a photographer and you're getting paid as an employee and eight hours as a DJ and you're getting paid as an employee and you're working 10 hours but you're doing that on a contract basis in photography and your real estate agents, your commissions are all over the place, you can't get disability insurance for that.

That's going to be a problem. Now, if you can bring some of your activities together under one structure and under one entity, then you can make – you might be able to get this done. So if I were working as a photographer and as a DJ and – I can't make Rodeo Klon work – and a graphic design artist and I brought those together under JJS Enterprises and JJS Enterprises is designed to provide graphic design services, audio services, and photography services to the wedding marketplace because I'm designing wedding invitations.

Well, now I've got an occupation that I can bring together under one business entity. I'm filing one tax return, Schedule C for JJS Enterprises or a corporate tax return and now I've got one entity. Well, now you can go ahead and get disability insurance. Yes. So hopefully your activities might be something that you can bring together, consolidate them under a business entity, make those activities the services of that entity, and then you can work your way through the business process, the business disability process.

Next, are there any special things to establish now to prove disability in the future? This is the same listener. For example, my greatest asset is my mind. I can learn and retain new information faster than almost anybody I've ever met. If I suffered a blow to the head and lost 50% of my mental function, I would still likely test within the normal range for intelligence and brain function.

I don't say this to sound conceited. My dad had a stroke and had this very thing happen and I'm sharper than he was. Is there a reliable way to establish that my baseline isn't average? Some kind of doctor certification, test results of some kind, the same question could apply to any unusual aptitude I think.

It's an interesting question. I've never seen that but what I would do is as with anything, any documentation that you can prove or provide is helpful. So if this aptitude that you've noticed is something that could be medically certified and if you could do it in a minimally intrusive way, I wouldn't spend thousands of dollars trying to plan for something that will likely never happen.

You're probably never going to get disability disabled. But if you could just say, "Hey, can we run a cognitive test or you're applying to Mensa and you say, 'Let me see if I can do this' and you can prove that," then that would be good information to have. But the reality is that when you are disabled, the way that the insurance company is going to calculate the fact of your disability is did you lose, did you suffer the loss of time at your occupation, duties at your occupation and/or income depending on your specific contract.

So that's going to make a difference, time, duties or income. So you're not going to be considered to be disabled because you had a loss of aptitude. If you could still function and do your job, do your work with 50% of your current mental functioning, you're not going to be considered to be disabled.

But if your mental functioning is going to influence your job, then the doctor would certify that and you would be considered to be disabled. The company here does make a difference. Some companies and I cannot name any specific companies. I would just encourage you to do research on companies.

I think – and I actually can't prove this. So let me be careful with what I say. I think the nature of the company makes a difference. I think there are insurance companies that are looking to cut anything they can and there are insurance companies that are looking to provide good service.

No insurance company is going to be trying to pay out a fraudulent claim. But there does make a difference of the insurance company. I feel like one of the things if possible is to work with a mutual insurance company. I've experienced this with USAA. As a USAA policy owner, when I've had to make insurance claims, I had accidents a couple of times I had to make insurance claims.

USAA was fantastic and I felt like I was treated fairly. I read some of the experiences of some other people with other companies that are not mutual insurance companies like USAA and it makes a difference. For years I worked with Northwestern Mutual and I was always very proud of Northwestern Mutual.

They always look to try to – they seem to try to always look to do the right thing. Now there's going to be disgruntled policy owners with any company. But I feel like that mutual versus stock company thing does make a difference and I think you want to work with a reputable company.

It doesn't make sense to me to always just work with the cheapest company out there because now when you need service, when you need them to pay the claim, it might not work out. So some companies build their reputation on their taking care of their customers. I think American Express has worked hard in this area as well.

If you've got a problem, they're going to try to take care of it. So choose your company carefully. I've got a few more questions here. Let's just buzz through them. Before I go to the next question from a listener, I expected to get this question. I haven't covered it yet but many people ask me or have asked me in the past about pregnancy.

Is pregnancy considered a qualifying event to receive on a disability policy? This can often happen especially if you're thinking that you're planning to have kids and you want to know. So the short answer is that yes, pregnancy is considered something that can pay out for disability. Generally, it will pay out more for short-term disability than for long-term disability although it can be effective for both.

But the key is to recognize that just simply the state of being pregnant is not a disability. But if you are disabled because of something that's associated to pregnancy or a complication from pregnancy, that qualifies as being disabled. So in a normal, healthy pregnancy and childbirth, in general, a mom who's recently given birth a couple of weeks after childbirth is going without any complications, is completely capable of going back to work.

So medically speaking, a normal childbirth is not going to qualify for a disability benefit simply because most moms can do their work up until the day that they – day before or day of that they're going to be giving birth. A few days of rest, a week or two of rest ideally is going to be best and then they're back at it.

Well, that's not going to satisfy the elimination period of a disability policy unless it's a very short-term disability policy. It's just not going to qualify. Just because you're choosing to stay at home and spend the first few months with your children and not go back to work doesn't mean that medically you can't go back to work.

So it's not going to trigger the policy. However, if there is a complication associated with pregnancy such as, "Hey, I had a friend recently. Her water is released in the sixth month of pregnancy. OK. There are three months of bed rest now." At that point in time, medically she cannot work.

And so once the elimination period of her contract has been satisfied – that's why I said a short-term is more likely to pay out. Once that two weeks or that three months is satisfied, then the policy will start paying benefits just like any other physical disabling condition. So pregnancy is covered.

It's just that most pregnancies don't result in a medical disability. So usually you're not going to get a payout just because you had a baby. Next question here. This one is funny. It's a little hard to understand the question but I love the question. "Hi, Joshua. I've heard your podcast for a while now.

I thought I should get in touch after hearing your recent podcast related to the importance of buying disability insurance. I'm interested in how the premiums receivable are calculated for certain disabilities. More specifically, what happens if an individual loses certain superpowers? As you may have seen recently, most movies are gradually starting to touch upon these superhumans amongst us.

I am personally not worried as my superpowers are unlikely to disable anytime but I'm still curious to understand the finer details of these financial transactions." Love the question. Well, the answer is if your superpowers are related to your job and if you lose some of your superpowers and that causes you to suffer a loss of time, duties or income at your job, then you've got a problem.

So the question is, do they know about your superpowers and are they going to be cataloged? They know about your super job. In general, it comes back to that loss of time, duties and/or income depending on the contract how it's written, time, duties and/or income. If you've suffered loss of those things, then you're generally going to receive a benefit once the terms of the contract have been fulfilled.

As long as your contract includes a partial disability payment, then it's going to pay you out a partial benefit. So if you lose some superpower and that causes you to not be able to have a 25% loss of time at work, as long as your policy has a partial disability benefit associated with it, then that 25% loss of work will come with a 25% benefit.

So that's the only way that the amount of money that you receive from a disability policy is going to be affected, is if you're receiving a proportional partial benefit. Most companies, anywhere from 20% to 80%, you'll receive a proportional benefit based upon the proportion of loss that you've experienced and then a proportion of the face amount of the policy.

So 50% loss, you have a policy that's $4,000, they're paying you out a 50% benefit, you're going to receive $2,000 a month. It's not related to a loss of any one superpower. So if you had 10 superpowers and you lost one superpower, but you could still have full time at your job, do all the duties of your job and earn as much income, just because you lost one superpower out of 10 doesn't mean you're going to qualify as being disabled.

Next question. Kevin says, "Hey, Josh. I love the series on disability insurance. Very helpful. I wanted to ask you a fairly general question about planning disability insurance. I'm a physician. It seems like there are quite a few physicians that listen to your show. By the way, thank you all the physicians that listen to the show.

Feel free to correct me on all my medical ignorance. And I've recently had to tell one of my patients that she has an incurable, progressively blinding condition that will most likely leave her unable to work in several years. She is still quite young, in the middle of her career, and I hated giving this devastating news.

She is but one of many people I take care of who face similar problems. Obviously, as someone who does not know the ins and outs of insurance, I can only direct them where they should go, but I want to be able to give them at least some helpful guidance as they deal with a major change to their lives.

I deal with quite a few people trying to apply for Social Security disability, and I have a similar view as you do. People who need it can't get it, and it's generally not enough for any meaningful subsistence. My question is, what options are there for someone who is just diagnosed with a permanently disabling condition, either presently or something that almost universally is disabling in the future, for securing disability insurance?

If there is anything, thank you for everything you do, Kevin. Kevin, unfortunately, the answer is there's no option. There's really not an option for disability insurance. Anytime your medical situation shows a hint of change, basically, most of your insurance options are going to be tossed out the window. Insurance companies are not in the business of losing money, and so they're not in the business of taking sick people.

The way that an insurance company works well is if they have their rates, and their rates can be applicable across the board, and they know that they're doing good underwriting. Now, there are always exceptions. You may apply for insurance and the next day be diagnosed, but once there's been a diagnosis, your options for insurance are very, very limited.

They're just practically non-existent. Again, insurance companies don't like things that are in flux. Even if something weren't going to result in a permanently disabling condition, even if it weren't almost assuredly going to result in blindness, even if something's in flux, all of a sudden things become difficult. When you buy insurance, insurance is not a right.

You have to ask and be accepted in the contract. What's interesting, as an insurance agent, I've been through this many times, clients' attitudes change. Insurance has to be sold a little bit, sold kind of aggressively in the sense that I've got to make the case. That's why I started this series with selling you insurance, talking about the impact, trying to evoke in you sales.

I'm trying to invoke in you an eager want for the product. I want you to want it. That's selling. I've got to transfer the enthusiasm that I have for the ownership of disability insurance to you. First, they've got to be sold. Many people come into a disability insurance discussion, just like many of you who are listening and they're not that interested.

They don't really want it. Then the insurance agent sells them on the idea. Then we take it to underwriting. What happens is that if we get any problems in underwriting as an insurance agent, it's funny because your client that wasn't sure that they were even going to accept the policy, they think they want to apply, they're going to think about it, okay, let's go ahead and make an application, buy the coverage.

They're thinking about all of a sudden they get very offended because it's kind of offensive to clients when the underwriter says, "Well, you're not quite our top choice." It changes the attitude. It's just always – I've always chuckled a little bit where I would have somebody who didn't want insurance.

I showed up. They said they didn't want insurance. I asked them good questions. I opened their minds to the value of insurance. We went ahead and submitted an application. Then all of a sudden, they're angry with me that the insurance company doesn't want them. They're offended. So there's no disability solution that I know of.

But that doesn't mean however that there can't be a solution that can be found. This is why I do radical personal finance, to demonstrate that financial tools such as insurance can be helpful and can be useful but there are other tools available as well. If I wanted a plan for the future of my family and I couldn't get life insurance, I could make a plan to make sure that my family is OK if I can't get life insurance.

I should do a show on that sometime. You can solve that problem without life insurance. How do you solve it? Well, I just remember so clearly a family that we used to know. They built a cabin up in the mountains. They had lots of kids. The dad was sick.

But when he died, he had an active family-operated business. They had no debt. They had a paid-for cabin, paid-for land in the mountains. The children were well-trained and were contributing to the business. So when dad died, the family was able to keep things going. He made a plan. He was prudent and he cared for his family even without buying life insurance.

Same thing with disability. Now this particular person, blindness doesn't necessarily mean that they're completely going to be unable to do anything. You can earn an income doing something that's blind, even if you're blind. I could do my job with some changes but I could do my job now that I do with blindness.

So the biggest opportunity for someone in that situation is – it's not going to happen probably with you as the doctor. It's not going to happen in the stress of the moment. But the biggest opportunity is let some time go. Let the emotions die down and then you make a new plan based upon the new constraints.

You say, "How can we take this problem and turn it into a solution?" Take the problem, turn it into a solution. Figure out, "OK, this is a constraint." It doesn't mean that if you've got an income, if you're a truck driver and you're going to go blind, you're not going to be a truck driver anymore.

But that doesn't mean you can't build new skills, new capacities for something that can be done even though you are blind. So that's the best solution for people in this situation. Probably not going to come from you, Kevin, just because you're a physician. But maybe you can encourage them that there are lots of people who have faced very difficult circumstances, including their own circumstance, and they'll be able to find a solution in time.

All right. I think that is – just look at the rest of the questions. I think that's all the questions that I want to take today. I hope this series has been useful to you all. I hope you've enjoyed it, a little bit of inside look and a little bit more knowledgeable.

If you've got more questions, I'd be happy to answer questions on a Friday Q&A call or I'd be happy to answer questions. You can send them by email. Sometimes they get in. Sometimes they don't. But I hope this has been useful to educate you and help you to feel a little bit more confident.

That's my hope. My hope is to give you some more information and help you to feel more competent. I always used to love the Sims model. Si Sims had the discount clothing store. An educated consumer is our best customer was their store model. I think they're out of business now.

But I always loved that model and an educated financial consumer is the best client for a good financial advisor, for a good insurance agent, et cetera. So I hope that – I mean I hope even just this insight in disability insurance. Insurance agents, they do a lot of work.

It can be very, very valuable. I don't think that you need insurance agents in everything. Sometimes it works great to go right to the company. But I mean hopefully some of this inside knowledge that I've shared with you, knowing what company to go and present your case to, knowing how to package the case, knowing which company is the best, that's why it's good to find an insurance agent that you can trust.

I feel one of the concerns that I have going forward is that the – for the financial planning industry is that the role of the insurance agent seems to be quickly falling to the wayside. Most young financial services professionals are interested in going to the investment side of the business.

Man, a good insurance agent is really, really valuable. I don't see those ranks being filled. But not my problem. Thank you all so much for listening. If you'd like to support the show, I would be grateful to you for doing it. The primary mechanism for me earning income from the show is patrons of the show, listeners who – and thanks for the content – sign up as a patron.

RadicalPersonalFinance.com/patron is where you can do that. RadicalPersonalFinance.com/patron. Thank you to the 260 of you who do that. Also if you would like to speak with me directly and have some kind of consultation on your situation, I'd be happy to serve you in that way. Go to RadicalPersonalFinance.com/phonecall. You can book a personal consultant call with me at RadicalPersonalFinance.com/phonecall.

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