When you’re finishing school there can be a lot of uncertainty. A lot of debt too. Figuring out how you’re going to manage your money can seem overwhelming.
The day after I finished my grad school, I went and applied for disability insurance, critical illness insurance, and life insurance. I also set up an RRSP (TFSAs didn’t exist yet). I did so because I recognized that there would be a good chance I would be self-employed one day and I would want this coverage at premium rates from when I was young! Ten years later, I am very glad I have those programmes, and very happy I managed to convince my husband too, even against his objections, because I know that if he were disabled I would need the coverage to help manage our bills, but also allow me to focus on him since I’m self-employed too! One in four people will be disabled for 90 days or longer at least once before the age of 65. So what protection will you put in place?
Are you, or someone you know, graduating from one of these programmes at a Canadian post-secondary institution?
If so, we should talk about whether your programme and graduation timing qualifies for a disability insurance plan at a significant savings, only available to recent graduates. For most programmes, you need to apply in your last year of study, or within one year of graduation so it’s important we look at how we can take advantage of the discount offer to start you on a plan that will have a life-long discount.
If you have debt, or feel you are young and healthy, you may wonder why you should get this kind of insurance now. So here are a couple of things to think about:
- At the start of your career your human capital is really high. That means your earning potential is high and the cost of NOT earning money for an extended period can be devastating.
- Consider this chart that shows your future earnings based on current income for the rest of your working life.
- Are you willing to risk your future earnings and savings? Make sure you protect yourself from an interruption in earnings due to illness or disability.
- Chances are you will not always have benefits, and/or will find yourself self-employed. If that is the case and you suffered a serious injury or illness, how would you make ends meet?
- Disability insurance can helps you to keep up with bills and expenses so that you can focus on getting better again.
- If you have debt, your creditors expect to get paid regardless.
- Whether it’s school debt, a line of credit, money owed to parents/grandparents, they still expect payments to be made if you are sick or injured so making sure you can meet your obligations.
- Being young and healthy is the best time to get insurance.
- Your premiums will be more affordable while you are young and before you have major health issues so getting insurance while you are still insurable will mean that you have this taken care of before it’s too late.
- The grad programme is only available for a limited time but the discounts are for life so you can design an affordable programme.
- You must qualify based on your graduation date for the discount so while you may not yet be making the money you hope to, we can design a policy that will help you take advantage of the discount today and into the future, while remaining more affordable today.
If you know someone graduating from these programmes and think it is worth considering? Get in touch so we can talk about it and see if it’s right for them.
p.s. Here is a first-hand account from someone who needed disability insurance.