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Start the New Year with a financial check up
*UPDATE: 4/23/2013* The 2013 Report on U.S. Physicians' Financial Preparedness is now available. View the report now.
The 2013 Report on U.S. Physicians' Financial Preparedness,* developed from research conducted by AMA Insurance in late 2012, revealed that while physicians may have insurance and retirement planning options in place, they don't review their policies or plans on a regular basis. So what does that mean for you? Important adjustments that reflect changes in your status or income may not have been made, all of which can leave you and your family in a vulnerable position.
CHECK FOUR KEY AREAS
Following are four areas to review that can help you achieve a higher level of comfort financially in the year ahead.
1. DISABILITY INCOME INSURANCE:
Unfortunately, accidents and illnesses can impair your ability to practice medicine. Be sure that you have a disability income policy in place and review your policy periodically.
Review your policy
Our poll showed that 76 percent of the physicians stated that disability income insurance is essential and 75 percent have a policy in place. However, 42 percent of those physicians have not reviewed their policies in the past five years. Are the provisions in your policy still appropriate? Do you have the right amount of coverage?
Do you have the right amount of coverage?
Findings indicate that the majority of physicians carry between $5,000 and $10,000 in monthly protection – which may or may not be enough for you.
2. LIFE INSURANCE:
Life insurance – whole and/or term – is a requisite for fiscal health. Its cost increases in proportion to your age so this is an area that should be checked now.
Most buy life insurance for death benefit
According to our survey, 75 percent of those polled do have some type of life insurance. Nearly half have term life, and another 33 percent own both term and whole life insurance. The majority purchased life insurance for its death benefit; while others use these products to help fund retirement or estate plans; or to fund certain legacy planning strategies. You need to be certain you have the coverage you need based on where you are in your career and your overall financial planning needs.
3. ESTATE PLANNING:
Our 2013 Report on U.S. Physicians’ Financial Preparedness indicated that nearly 60 percent of the physicians polled do not have an updated will and only 50 percent have end-of-life medical directives and a power of attorney in place. Charitable giving is also a neglected area and one that may bear attention, especially by those with a significant portfolio.
Increase your comfort level
Take time to review and update your plans and discuss your best options with a trusted financial planner such as those that are part of the Agency's Physicians Financial Partners network. Your comfort quotient will increase immeasurably and your family will appreciate the effort.
4. LONG TERM CARE:
We are all living longer and healthier lives, but one unfortunate catastrophic health event can drain retirement and other savings quickly.
Advanced planning the best defense
Advanced planning may be the best defense, but our report showed that most physicians do not have a long-term care plan even though half of them have considered it. A variety of plans now exist, including options that combine the benefits of life insurance with traditional long-term care insurance. Talk to your financial advisor to determine the type of plan that will work best for you.
Take the time now to review each of these areas, in addition to the rest of your personal financial situation. This effort will result in greater peace of mind for you and your family in the year ahead.
The 2013 Report on U.S. Physicians' Financial Preparedness is now available. View the report now.
Click on these links for more information about AMA Insurance products:
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