In honor of Disability Insurance Awareness Month, I’m shining a light on a risk that’s often overlooked, yet has the power to disrupt even the most thoughtfully designed financial plan.
When people think about protecting their finances, they usually focus on market volatility, retirement planning, or life insurance. What’s often missed is the single asset that makes all of that possible: your ability to earn an income. Losing that ability is far more common than most people expect, and far more financially disruptive than many risks we plan for first.
Over the past year alone, several of my clients went on disability claim. They happened during real-life moments - purchasing a home or growing their family. Because income protection was already in place, their plans didn’t fall apart. Life didn’t pause. They were able to move forward with confidence and continuity.
Your Income Is Your Greatest Asset
For most professionals, your income is the engine that powers everything else in your financial plan. It funds your lifestyle, supports your family, builds your investments, and ultimately creates your long-term wealth.
If that income stops, even temporarily, the ripple effects can be significant:
- Savings plans get paused
- Investment and Retirement contributions slow or stop
- Debt becomes harder to manage
- Financial stress increases at the worst possible time
What’s often surprising is how common this risk actually is. A long-term disability is far more likely during your working years than many realize, yet it’s one of the least insured risks. General statistics show that 1 out of 4 people will go on disability claim before retirement age.
The Unseen Gap
Many individuals assume they’re covered through work. While employer-provided disability insurance is a great starting point, it often falls short in a few key ways:
- Limited coverage: Typically replaces only 40–60% of base income
- Taxable benefits: If the employer pays for the coverage, the benefit is taxable
- Bonuses and variable income excluded
- Lack of portability: Coverage mostly does not follow you if you change jobs
For high-income professionals, business owners, or those with specialized careers, this gap can be especially meaningful.
Disability Insurance as a Planning Tool
At WestPac Wealth Partners, we view disability insurance not as a standalone product, but as a core component of a well-structured financial plan.
The right policy is designed to:
- Protect your earning power -the foundation of your financial life
- Maintain your lifestyle during an unexpected health event
- Keep long-term goals like retirement and education planning on track
- Provide flexibility and confidence during uncertain times
This isn’t about preparing for the worst - it’s ensuring that one or more unexpected events don’t derail everything you’ve worked to build.
Customization Matters
Not all disability insurance is created equal. The details matter, and they should align with your profession, income structure, and long-term goals.
Some key features we evaluate with clients include:
- Own-occupation coverage (especially important for specialized professionals)
- Benefit period and elimination period
- Cost-of-living adjustments (COLA)
- Future increase options as income grows
- Supplemental coverage to fill employer plan gaps
- Contract language that determines how you get paid
A tailored approach can help coverage integrate seamlessly with the rest of your financial strategy.
A Conversation Worth Having
Disability Insurance Awareness Month is a great reminder to revisit this often-overlooked area. Whether you already have coverage or have never explored it, a quick review can provide clarity and confidence.
At the end of the day, financial planning isn’t only about growth - it’s also about protecting the income you’re going to bring to your family and protecting wealth you’ve already built. Protecting your ability to earn may be one of the most important decisions you make.
Disability insurance works best if it’s integrated into the bigger picture. If you’d like to understand what you have, what gaps may exist, and how it fits into your overall plan, let’s have that conversation.
Registered Representative and Financial Advisor of Park Avenue Securities LLC (PAS). OSJ: 5280 CARROLL CANYON ROAD, SUITE 300, SAN DIEGO CA, 92121, 619-6846400. Securities products and advisory services offered through PAS, member FINRA, SIPC. Financial Representative of The Guardian Life Insurance Company of America® (Guardian), New York, NY. PAS is a wholly owned subsidiary of Guardian. WestPac Wealth Partners LLC is not an affiliate or subsidiary of PAS or Guardian. Insurance products offered through WestPac Wealth Partners and Insurance Services, LLC, a DBA of WestPac Wealth Partners, LLC. CA Insurance License Number - 0M18376. | Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation. | 8910363.1 Exp. 05/28